Double Line Gundlach the Big Easy Slides MAR 2013

7/28/2019 Double Line Gundlach the Big Easy Slides MAR 2013

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LiveWebcasthostedby:

JeffreyGundlach

ChiefExecutiveOfficer

March5,2013


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FundOfferings

RetailandInstitutionalClass

NoLoadMutualFund

RetailandInstitutionalClass

NoLoadMutualFund

TotalReturnBondFund CoreFixedIncomeFund

Retail Inst.Nshare Ishare

Retail Inst.Nshare Ishare

Ticker DLTNX DBLTX

MinInvestment $2,000 $100,000

Min

IRA

Investment $500 $5,000GrossExpenseRatio 0.76% 0.51%

Ticker DLFNX DBLFX

MinInvestment $2,000 $100,000

Min

IRA

Investment $500 $5,000Gross ExpenseRatio 0.80% 0.55%

TheFundsinvestmentobjectives,risks,chargesandexpensesmustbeconsideredcarefullybeforeinvesting.The

prospectuscontains

this

and

other

important

information

about

the

Funds,

and

it

may

be

obtained

by

calling

1

(877)3546311/1(877)DLINE11,orvisitingwww.doublelinefunds.com.Readitcarefullybeforeinvesting.Investmentsindebtsecuritiestypicallydecreaseinvaluewheninterestratesrise.Thisriskisusuallygreaterforlongertermdebtsecurities.

InvestmentsinAssetBackedandMortgageBackedSecuritiesincludeadditionalrisksthatinvestorsshouldbeawareofsuchascreditrisk,prepaymentrisk,

possibleilliquidityanddefault,aswellasincreasedsusceptibilitytoadverseeconomicdevelopments.Investmentsinlowerratedandnonratedsecurities

.

andpolitical,economicandcurrencyrisksanddifferencesinaccountingmethods.TheTotalReturnBondFundintendstoinvestmorethan50%ofitsnetassetsinmortgagebackedsecuritiesofanymaturityortype.

Opinionsexpressedaresubjecttochangeatanytime,arenotforecastsandshouldnotbeconsideredinvestmentadvice.

DoubleLineFunds

are

distributed

by

Quasar

Distributors,

LLC.

WhiletheFundsarenoload,managementfeesandotherexpensesstillapply.Pleaserefertotheprospectusforfurtherdetails.

PastPerformancedoesnotguaranteefutureresults.Indexperformanceisnotillustrativeoffundperformance.Aninvestmentcannotbemadeinanindex.1


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WebcastNews

JeffSherman March19,2013MultiAssetGrowth

1:15pm

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LiveWebcasthostedby:

JeffreyGundlach

ChiefExecutiveOfficer

March5,2013


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GovernmentSpending


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Trade,ExchangeRates,BudgetsandInterestRates

As

of

October

20,

2012

Germany

Source:http://www.economist.com/news/economicandfinancialindicators/21564865

The

Economist,

Trade,

exchange

rates,

budget

balances

and

interest

rates,

October

20,

2012GDP=Themonetaryvalueofallthefinishedgoodsandservicesproducedwithinacountry'sbordersinaspecifictimeperiod,thoughGDPisusuallycalculatedonanannual

basis.

7


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GlobalPublicDebttoTaxRatiosAsofDecember31,2010

Germany

8


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ComparingCentralBanksBalanceSheetsJanuary1,1995throughJanuary31,2013

4000

4500

4000

4500

ComparingCentralBankBalanceSheets

BillionsofUSD

3000

3500

3000

3500 FederalReserve

Bankof

Japan

BankofEngland

EuropeanCentralBank

2000

2500

2000

2500

illio

nsofUS w ss at ona an

1000

1500

1000

1500

0

500

0

500

9Source:Bloomberg,DoubleLine Capital


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DevelopedWorldQuantitativeEasing(QE)asa

PercentageofGDP(January1,2007throughFebruary28,2012)

http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2012/10 2/20121029_CB5_1.png

HowCentralBankPolicyImpactsAssetPricesPart5:HowFarCanTheyGo?TylerDurden,October29,2012.Fed USFederalReserve

BoJ =BankofJapan

ECB=EuropeanCentralBank

BoE=BankofEngland

GDP=

GrossDomestic

Product.

The

monetary

value

of

all

the

finished

goods

and

services

produced

within

acountrys

borders

in

aspecific

time

period,

but

calculated

on

anannualbasis.

10


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CentralBanksBalanceSheetsvs.GoldJanuary31,1995throughJanuary31,2013

40000

45000

1800

2000

GoldPrice

30000

35000

1200

1400

1600

eSheets

SD

, ,

BOJ,

ECB,

PBoC,

SNB,

CBR

15000

20000

25000

800

1000

ions

USDBalan

PriceGold

5000

10000

200

400

Bill

00

11

GoldPrice=Goldspotpricequotedintroyounces.

Fed USFederalReserve PBoC =PublicBankofChina

BoJ =BankofJapan SNB=SwissNationalBank

ECB=European

Central

Bank CBR

=Central

Bank

of

Russia

BoE=BankofEngland

Source:Bloomberg,DoubleLineCapital


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GlobalFiscalSurplustoGDPAsofDecember31,2010

Germany

GDP=Themonetaryvalueofallthefinishedgoodsandservicesproducedwithinacountry'sbordersinaspecifictimeperiod,thoughGDPisusuallycalculatedonanannual

basis.BIS=BureauofindustryandSecurity 12


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NetWorthinFinancialAssetsbyCountryAsofDecember31,2012

13Source:Organization

for

Economic

Cooperation

and

Development

(OECD),

Goldman

Sachs

Equity

Research

The

best

of

Fortnight

Thoughts,

December

13,

2012


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JapansGovernmentSpending

January

1,

2002

through

January

31,

2013

on

InJPY

InJPYBilli

Billion

Germany

Source:http://www.tradingeconomics.com/japan/gdp

growth

annual

JPY=JapaneseYen15


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JapansBirthrate

January

1,

1967

through

January

31,

2013

er1

,000Peopl Pe

r1,000

People

Germany

Source:http://www.tradingeconomics.com/japan/gdp

growth

annual

Crudebirthrateindicatesthenumberoflivebirthsoccurringduringtheyear,per1,000populationestimatedatmidyear.16


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JapansTradeBalance

June28,1985throughDecember31,2012

Germany

Source:Bloomberg

Financial

Services 17


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NikkeiYields

January 1,2000throughOctober31,2012

TheNikkeiisnowevenofferingyieldsaboveJapanesegovernmentbondsandtheUSS&P500yield

Yi

eld(%) Yie

ld(%)

Germany

Year

18

Source:BloombergFinancialServices

Nikkei225

Index

Total

Return

=An

index

showing

the

average

closing

prices

of

225

stocks

on

the

Tokyo

Stock

Exchange.

Aninvestmentcannotbemadeinanindex.


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Nikkeivs.JapaneseGovernmentBonds

December31,2009throughFebruary28,2013

1.15

1.20

2013) NIKKEI225TotalReturn(JPY)

MerrillLynchJapaneseGovernmentTotalReturn

$1.17

1.00

1.05

1.10

thof1Y

en

February28,

Index(JPY)GOYO$1.08

0.90

0.95

IndexedGro

ber

31,

2009

0.75

0.80

.

(Decem

Germany

19

Source:BloombergFinancialServices,MerrillLynchIndicesdenominatedinJapaneseYen(JPY).

Nikkei225IndexTotalReturn=Anindexshowingtheaverageclosingpricesof225stocksontheTokyoStockExchange.

GOYO=BofA/MerrillLynchJapaneseGovernmentBondIndexTheBofA MerrillLynchJapanGovernmentIndextrackstheperformanceofJPYdenominatedsovereigndebt

publiclyissuedbytheJapanesegovernmentinitsdomesticmarket.Qualifyingsecuritiesmusthaveatleastoneyearremaining

termto

final

maturity,

afixed

coupon

schedule

and

aminimum

amount

outstanding

of

JPY

200

billion.

Thischartillustratestheperformanceofahypothetical1Yeninvestmentmadeintheseindexeson123109.Thischartdoesnot implyanyfutureperformance.



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JapaneseIndexvs.S&P500Growthof$1December29,1989throughFebruary28,2013

NIKKEI225TotalReturn(USD)$5.84

S&P500TotalReturnIndex(USD)

$0.55

20

Source:BloombergFinancialServices,DoubleLineCapital LPdenominatedinUSdollar.

Nikkei225IndexTotalReturn=Anindexshowingtheaverageclosingpricesof225stocksontheTokyoStockExchange.

S&P500Indexisacapitalizationweightedindexof500stocks.

Thischart

illustrates

the

performance

of

an

hypothetical

$1

investment

made

in

the

two

indexes

on

12

29

89.

This

chart

does

not imply

any

future

performnace.



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Nikkeivs.S&P500 Last10Years

March5,2003throughMarch4,2013

Germany

21

Source:BloombergFinancialServices,DoubleLineCapital LP

Nikkei225

Index

Total

Return

=An

index

showing

the

average

closing

prices

of

225

stocks

on

the

Tokyo

Stock

Exchange.

SPX=S&P500Indexisacapitalizationweightedindexof500stocks.



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12MonthJPYvs.5yearJPY

AsofMarch4,2013

Source:BloombergFinancialServices,DoubleLineCapitalLPdenominatedinU.S.Dollars

JPY=TheNYSEArca JapanIndexisapriceweightedindexof210commonstockstradedontheTokyoStockExchangerepresenting abroadselectionofindustries.

Aninvestmentcannotbemadedirectlyinanindex.

22


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JapaneseConsumerConfidenceJanuary1,2010throughJanuary31,2013

23http://bonddad.blogspot.com/2013/02/japaneseconsumerconfidencemakes.html

JCOMSHCF=JapaneseConsumerConfidenceindex.SubjecttoonemonthlagreleasedbytheEconomicandSocialResearchInstitute.


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U.S.Surplus/DeficitAsAPercentageofGNP/GDPDecember31,1790throughDecember31,2011

Source:http://www.ritholtz.com/blog/wp

content/uploads/2012/12/surplus

deficit

gnp.png

GrossNationalProduct(GNP)orGrossDomesticProduct(GDP)=ReferstothegrossDomesticProductormarketvalueofallfinal goodsandservicesproduced

withinacountryinagivenperiod.

24


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USDebt&GDP

January1,2009throughJune30,2012

Germany

25

Source:AdvisorPerspectives.com,Strrettalklive.com

http://advisorperspectives.com/dshort/guest/LanceRoberts

121118

Ceilings

Cliffs

and

TAG.php

GDP=GrossDomesticProduct.Referstoallofthegoodsandservicesproducedinaneconomy.


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DebtTransferfromPrivatetoPublic

26http://online.wsj.com/article/SB10001424127887324906004578287810277763042.htmlGDP=GrossDomesticProduct.Theamountofgoodsandservicesproducedwithinagiveneconomy.


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FederalReserveBalanceSheet

December18,2002throughApril18,2011

http://www.marketoracle.co.uk/Article29854.html,TheMarketOracle

MaidenLane,AIAAuroraLLCandALICOarealllimitedpartnershipsformedbytheUSGovernmenttoallowth eFederalReservetopurchase,sellandtransferAmerican

InsuranceGroup

(AIG)

and

Bear

Stearns

assets.

The

TALF

LLC

was

aspecial

purpose

vehicle

to

consolidate

Federal

Reserve

NY

Balance

sheet. 28


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WhatDidtheAggregateQEProgramsGiveus?

http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2012/102/20121029_CB1_1.png

QE=QuantitativeEasingprograms.Source:

Bloomberg,

DoubleLine Capital 29


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PerformanceSinceInceptionQE2October4,2011throughMarch4,2013


CRY=TR/JCRBCommoditiesExcessReturnIndexisanarithmeticaverageofcommodityfuturesprocesswithmonthlyrebalancing.

SPX=Standard

&

Poors

500

Index

is

acapitalization

weighted

index

of

500

stocks.

The

index

is

designed

to

measure

performance of

the

broad

domestic

economy.

TLT=iShares Barclays20+YearTreasuryBondFundinanexchangetradedfundincorporatedintheUSA.

Youcannotinvestdirectlyinanindex.

30


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LaborParticipationRatesbyAgeGroupJanuary1,1990through2020ProjectedEstimates

http://www.calculatedriskblog.com/2012/10/understandingdecline

in

participation.html

Source:CalculatedRiskBlog

31


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InflationComparisonJanuary1,1978throughSeptember30,2012

32http://globaleconomicanalysis.blogspot.com/2012/08/tradingcaps

and

gowns

for

mops

why

go.html


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%ofDebtBalance90+DaysDelinquentJanuary1,2003throughMarch31,2012

33http://www.cnbc.com/id/49983471


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%of90+DayDelinquentStudentLoans

December31,2002throughSeptember30,2012

34


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StudentTuitionCostsvs.AverageGraduateEarningsJune30,2000throughJune30,2010

35


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TABIIBloodlessVerdictoftheMarket


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BofA/MerrillFixedIncomeIndexReturns

Grey=Year2012

Blue=YearToDate2013

4.74%15.44%

13.63%

HighYield(JOAO)

Convertibles(VOSO)

1.43%

.

9.52%

18.30%InternationalEmerging(IGOV)

0.49%

0.14%

3.28%InternationalDeveloped(NOGO)

orpora e

0.20%

0.14%

2.19%

.

Government(G0A0)

Mortgages(MOAO)

37

DataSource:BofA/MerrillLynchIndicesthroughyearendDecember31,2012andyeartodate2013throughMarch1,2013.

Pleasesee

the

Appendix

for

index

definitions.

An

investment

cannot

be

made

directly

in

an

index.


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BofA/MerrillFixedIncomeIndexReturns

19.70%

rey=

ear

Blue=YearToDate2013

1.26%

3.65%

14.36%BBRatedHighYieldCredit(JOA1)

1.75%

11.98%

15.03%

BRatedHighYield(JOA2)

0.03%

0.29%

9.82%ARatedCredit(COA3)

0.42% 3.97%AAARatedCredit(COA1)

DataSource:BofA/MerrillLynchIndicesthroughyearendDecember31,2012andyeartodate2013throughMarch1,2013.

PleaseseetheAppendixforindexdefinitions.Aninvestmentcannotbemadedirectlyinanindex.

38

InvestmentGrade=IndicesratedAAAtoBBB (shownabove)areconsideredtobeinvestmentgrade. AbondisconsideredinvestmentgradeifitscreditratingisBBB or

higherbyStandard&PoorsorBaa3byMoodys.Thehighertherating,themorelikelythebondistopaybackatpar/$100cents onthedollar.AAAisconsideredthehighest

qualityand thelowestdegreeofrisk.Theyareconsideredtobestableanddependable.

BelowInvestmentGrade=Alsoknownasjunkbond(shownabove)isasecurityratedbelowinvestmentgradehavingaratingofBBB orbelow.Thesebondsareseenas

havinghigher

default

risk

or

other

adverse

credit

events,

but

typically

pay

higher

yields

than

better

quality

bonds

in

order to make

them

attractive.

They

are

less

likely

to

pay

backatpar/$100centsonthedollar.



40/73

Eurovs.S&P500IndexMay23,2011throughMarch42013


S&P500indexisabasketof500stocksthatareconsideredtobewidelyheld.Itisweightedbymarketvalueanditsperformanceisthoughttoberepresentativeofthestockmarketas

awhole.

Euro

=

The

official

currency

of

the

European

Union

(EU)

members

who

have

adopted

it

including:

Austria,

Belgium,

Finland,

France,

Germany,

Greece,

Ireland,

Italy,

Luxembourg,

the

Netherlands,NewZealand,Portugal,andSpain.


39


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S&P500IndexandShanghaiIndexJuly11,2011throughMarch4,2013

Source:BloombergFinancialServices,DoubleLineCapitalLP

S&P500indexisabasketof500stocksthatareconsideredtobewidelyheld.Itisweightedbymarketvalueanditsperformanceisthoughttoberepresentativeofthestock

marketasawhole.SPXTistheS&P500indexnettotalreturnindex.

SHCOMP

=

The

Shanghai

Stock

Exchange

Composite

is

a

capitalization

weighted

index

tracking

daily

price

performance

of

all

A

and

B

shares

listed

on

the

Shanghai

Stock

Exchange.ThisindexwasdevelopedDecember19,1990withabasevalueof100.


40


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ShanghaiIndexDecember31,2009throughMarch42013


Note:

The

Shanghai

Stock

Exchange

Composite

is

a

capitalization

weighted

index

tracking

daily

price

performance

of

all

A

and

B

shares

listed

on

the

Shanghai

Stock

Exchange.ThisindexwasdevelopedDecember19,1990withabasevalueof100.


41


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GoldSpotIndexYearEnd2007throughMarch4,2013



42


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CRBCommodityIndexYearEnd2007throughFebruary28,2013


Note:

The

TR/J

CRB

Commodity

Excess

Return

Index

is

an

arithmetic

average

of

commodity

futures

prices

with

monthly

rebalancing.Aninvestmentcannotbemadedirectlyinanindex.

43


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46/73

HomeownershipRate

, ,

45Source:BloombergFinancialServicesHomeownership

affordability

measured

quarterly

and

subject

to

aone

month

lag.


45

f d


47/73

MortgageRefinancingIndexJanuary4,2002throughFebruary22,2013


MortgageRefinancingIndexasmeasuredbythe MortgageBankersAssociation.Reflectsthenumberofapplicationsforrefinance.Notallapplicationsareaccepted.

Aninvestment

cannot

be

made

directly

in

an

index.

4646

30 Y U S M R


48/73

30YearU.S.MortgageRatesDecember31,2007throughMarch1,2013

Source:BloombergFinancialServices,Bankrate.com

ILM3NAVG=The

Overnight

National

Average

of

the

U.S.

30

year

Treasury

interest

rate.

They

help

consumers

see

the

movement

of rates

day

to

day.

Subject

to

one

daylag.

4747

Home Price Index Levels and Year Over Year Change


49/73

HomePriceIndexLevelsandYearOverYearChangeJanuary1,2000andJanuary1,2001throughOctober2012

S&P/CaseShiller

HomePriceIndex

S&P/CaseShiller

HomePriceIndex

CoreLogic

NationalHousing

PriceIndex

CoreLogicNational

HousingPriceIndex

Source:BloombergFinancialServices,CaseShiller

48

48

S&P/CaseShillerHomePriceIndexiscomprisedofpricechangeswithinthefollowingsubsetof20metropolitanmarkets:10City IndexBoston,Chicago,Denver,LasVegas,Los

Angeles,Miami,NewYork,SanDiego,SanFranciscoandWashingtonDC.Inadditiontothe10CityIndexitincludes:Atlanta,Charlotte,Cleveland,Dallas,Detroit,Minneapolis,

Phoenix,Portland,Seattle,andTampa.

CoreLogicNationalHousingPriceIndex(HPI)=CoreLogicisaleadingproviderofinformationandanalytics.Thisindexcovers 6,208zipcodes,572statisticalareasand1,027

countieslocatedinall50statesandDistrictofColumbia.Itisanationalaverage.


Home Prices in Major US Metropolitan Areas


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HomePricesinMajorUSMetropolitanAreas

January1,2006throughDecember31,2012

49

ABX AAA 071 Index


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ABXAAA07 1Index

December31,2009throughMarch4,2013


TheABX071AAAIndexisabasketofhomeequity.Constitutedfromreferenceobligationsissuedby20issuersofresidentialmortgagebackedsecurities.


50

Non Agency RMBS 60++ Delinquency Rate


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NonAgencyRMBS60++DelinquencyRateJanuary31,2005throughJanuary31,2013

60%

39.4%

40%

uencies

anuary20

13

23.4%

20%

30%

0+

+SeriousDelin

ary2005throughJ

11.1%

10%

Janu

AltA

Subprime

0%

SeriousDelinquenciesisdefinedbymortgagesthatare60++delinquencyratesdefinedasloans60 or90dayslateinmortgagepayments,oralreadyinforeclosureorREOstatus.

PrimedefinedasFICO>725andLTV725andLTV>=75

Subprimedefined

as

FICO

725andLTV725andLTV>=75

Subprimedefined

as

FICO

725andLTV725andLTV>=75

Subprimedefined

as

FICO

Double Line Gundlach the Big Easy Slides MAR 2013

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Transcript of Double Line Gundlach the Big Easy Slides MAR 2013