Update : Having lambasted The Fed, and rightly so, Jeff Gundlach decided to crossover into political punditry this evening in an interview with Fox Business' Neil Cavuto.

During the extended interview, Gundlach made two bold predictions - that Joe Biden's "time had passed" and would not be the Democratic Party nominee; and perhaps even more notable, that President Trump may pull out of the 2020 race.

"I think Joe Biden is a placeholder type of candidate," Gundlach scolded, "he's been running for president for 32 years and amassed exactly zero delegates." “So it’s almost hilarious that he is called this electable candidate because he dropped out in 19[88] on a scandal, then he made it to Iowa in 2008 and got less than one percent of the vote,” he said. “His time has passed.” “I have a nickname for him, Jurassic Joe. It’s not a reference to his age. It’s a reference to the fact that he is a politician from a different era."

Of Trump, Gundlach said, “I am not even sure he’s going to really run,” noting that his second term will be determined by the success of the U.S. economy...

“If the economy goes into recession and he can’t pullout by removing the tariffs, there’s very little for him to run on,” he said.

Gundlach said, as long as the economy doesn’t falter, Trump will win re-election. But he warns, there’s a chance Trump might pull out of the presidential race.

“Lyndon Johnson ran for a while too and then pulled out because of the war problems,” Gundlach said.

As a reminder, Gundlach did correctly forecast that Trump would win the presidency in 2016, warning at the time that "things could get scary."

“People aren’t getting along, they’re not happy because of technology taking jobs, and sort of this long, slow grind of a new economy. And so they’re looking for change, and I think Trump is going to win on the basis of that,” Gundlach said on “Fast Money Halftime Report. ” “And he will be quite a bit like Ronald Reagan.” From a trading perspective, Gundlach said Trump is “bonds negative and stocks positive.”

So he nailed that!

* * *

John Williams suggested a few weeks ago that the Fed wouldn’t be beholden to bond markets. As Bloomberg's Cameron Crise noted earlier, Williams "was wrong."

The ultimate justification for the change in tune looks to be a downgrade to the inflation profile, even though just six weeks ago the inflation shortfall was deemed to be “transitory.” It’s hard to escape the notion that the Fed was dragged into this shift by market pricing; it seems as if bond traders are running policy now.

And that is exactly what Jeffrey Gundlach, chief executive of Doubleline Capital, said to Reuters tonight:

...the Federal Reserve is doing "what the bond market says - with a lag." "The bond market definitely helped to encourage the 'Fed pivot'."

The bond king went further during a discussion on Fox Business, suggesting:

“The bond market has been saying that the Fed’s policy is too tight by a very large amount for the past several weeks, if not few months, and the Fed simply cannot ignore that.”

But, as Gundlach went on, the stock market's belief that The Fed will hold back the recession (as opposed to the bond market's much more worrisome outlook), is wrong...

“The three-month bill yield compared to the 10-year Treasury yield has every bit the look of a recession coming within 12 months and maybe within six months because that rate is inverted,” Gundlach said. “Ironically, a lot of people think if the Fed eases it'll be an insurance policy against recession. But if past patterns are prologue, if we actually start steepening out the yield curve from an inversion three months to 10 years, that's actually highly coincidental with the coming recession.”

And tweeted a concise and ominous statement of his thoughts...

Fed message today was essentially: the case for easing has strengthened, we hope that changes soon, if it doesn’t we’re behind the curve. — Jeffrey Gundlach (@TruthGundlach) June 19, 2019

As Crise concludes, the ultimate justification for the change in tune looks to be a downgrade to the inflation profile, even though just six weeks ago the inflation shortfall was deemed to be “transitory.”

It’s hard to escape the notion that the Fed was dragged into this shift by market pricing; it seems as if bond traders are running policy now.