Jeff Gundlach on the global economy, the Fed's next move, and negative interest rates (USD, DXY, TLT, TLO, SPY, SPX, DJI, IXIC, IWIM, QQQ)

Thomson Reuters

Jeff Gundlach held his latest webcast on markets and the economy, called "Connect the Dots," on Tuesday.

The big takeaways were:

• The Federal Reserve has no business raising rates right now. Markets aren't pricing in a hike this month in, and no one has forgotten the volatility that ensued after the first hike in December.
• The rally in risk assets is near its end. Stocks have 2% of upside but 20% of downside. And there's still time to wait for commodities to cheapen more before buying.
• There isn't a strong case for an imminent US recession.
• Negative interest rates are bad for the world. They are having the opposite effect on currencies like the Japanese yen, which has rallied instead. They are also hurting European banks.

Here's the summary:

Here's the title slide for Gundlach's presentation.

If you look closely, there are two bears, which tells you much of what you need to know about Gundlach's outlook.

On politics, he said that if you think this election cycle is crazy, then just wait four years. He thinks Republican hopeful Marco Rubio may drop out after Tuesday's voting.

He said that politics will continue to drive markets and the economy. And he added that a win by Donald Trump would mean more fiscal stimulus for the economy.

Jeb!

The Fed needs to review its rate-hike plans.

That's the Fed's dot plot, which shows the Federal Open Market Committee's (FOMC) projections for interest rates out to 2018. Gundlach said that the Fed's forecasts are not wise given how they diverge from central banks' abroad.