Dollar Plunge Incoming? Billionaire Says Currency Crash Could Be Imminent… Is Your Wallet Ready?

So, Jeffrey Gundlach, a man affectionately known in the higher circles of finance as the “Bond King” (presumably due to his love of regal titles and possibly paper hats), has just sounded the sort of warning that only billionaires can deliver without being asked to leave the dinner table. According to Gundlach, the US dollar is wobbling like a particularly indecisive jelly at a tea party and may soon collapse in on itself, or at least shed a rather impressive amount of value. 💸

In what can only be described as a thrilling new video update (if you find the US dollar index, known to its closer friends as DXY, particularly sexy), Gundlach explains he’s keeping one suspiciously well-trained eye on this index, which basically involves comparing the dollar to a hand-picked group of other currencies, none of which regularly volunteer for the job.

The DXY, says Gundlach, has been on a macro downtrend, which is economist-speak for “it’s doing the financial equivalent of losing its house keys, tripping over the cat, and spilling tea on its best trousers”—and if it slips below a critical, sacred, almost mythic diagonal trendline, the sort some technical analysts draw on charts during long winter evenings, it could “melt down.” As in, really lose its cool.

“The dollar has been in a pattern of lower highs going all the way back to 1985,” says Gundlach, no doubt drawing lines on napkins in expensive restaurants. “Lower lows too, except for 2020 (let’s all agree to quietly ignore 2020, shall we?). I personally think the dollar’s best hope is to buy a nice hat and maybe change its name. But in all seriousness, if it breaks below that wild and crazy trendline between 2011’s low (DXY at 72, for those who love numbers) and 2021’s ‘let’s call it a low’ at 89, then the real bear market will be unleashed. Like, properly. Should this happen, expect the chart to nosedive under that already-low level of 72 or ‘whatever,’” he added with the tone of a man narrating a slightly alarming wildlife documentary. “Now this is surreal.” 😳

In short, thanks to Gundlach’s magic diagonal, the DXY must cling fruitlessly to 97 or higher to avoid a majestic 25% plunge suggesting the sort of drama usually reserved for daytime soap operas. Currently, it floats at 98.24, which is close enough to warrant a nervous cup of tea but not quite close enough to panic-yodel.

Last week, Mr. Bond King himself warned that the stock market, the dollar, and the Treasury market are all acting, to put it bluntly, “weird.” This, coming from a man whose life is devoted to markets, is as close to a financial exorcism as one can hope for. Foreign investors, armed with piles of US assets, might soon vote with their feet, wallets, and probably a few slightly indignant letters, all thanks to the US government’s ongoing demonstration of how not to handle a fiscal path.

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2025-06-17 12:21