Josh Brown is a rising star in both the financial blogging and asset management worlds. He published some notes today from a lunch held by Jeffrey Gundlach, a legendary bond fund manager who opened his own firm, Doubleline, two years ago. Gundlach raised an astonishing $16 billion on the strength of his reputation and previous performance. The Los Angeles Times just covered the jury verdict in the trial between him and a former employer. The trial revealed that Gundlach had made $239m in the last 20 years, according to the suit brought by his former bosses at TCW. Though the LA Times rebuts this claim:
During the trial, Gundlach estimated his personal net worth at about $90 million, some of which he has sunk into an extensive collection of modern art.
Either number would make Gundlach a member of the Ultra High club in terms of his net worth. That brings us to the point of this post. During the recent lunch in New York, Gundlach explained that one thing driving the art market—as well as the markets for gold, gems and other hard assets—is the need to store value outside of the financial system itself. Here’s Brown paraphrasing Gundlach:
Jeffrey says his own assets are now 2/3rd’s outside of the “financial system” other than his ownership stake in DoubleLine. This means fine art, gold, gemstones, rental property etc. He says the ultra wealthy should have 50% of their assets outside of the financial system.
Notes from the DoubleLine Lunch with Jeffrey Gundlach (TheReformedBroker.Com)
Jury Renders Split Decision on Jeffrey Gundlach-TCW Case (Los Angeles Times)