"New Bond King" Gundlach Bets on Low-Probability Events, Replaces Some High-Coupon U.S. Treasuries With Lower-Coupon Ones

```htmlAccording to Jinse Finance, on May 8, Jeffrey Gundlach, founder of DoubleLine Capital and known as the "new bond king," stated that if an economic recession occurs in the future, the United States may choose to swap high-coupon US Treasury bonds held by bondholders for varieties with lower interest expenditures. This adjustment could cover the entire maturity curve. To proactively address this potential situation, Gundlach has already replaced some portions of his investment portfolio, including high-coupon US Treasuries in his flagship portfolio, with low-coupon US Treasuries of the same term. He is concerned that in order to reduce interest expenses during a future recession, the US government might unilaterally lower the coupon rates on all outstanding debt. As an example, he mentioned that the government could reduce the coupon rate from 4% to 1% without changing the debt maturity, describing it as "the ultimate measure to postpone the problem." If the government did take such action, bond prices would inevitably plunge. However, he admitted that the likelihood of the US government doing so is extremely low. (Dongxin News Agency)```