Gundlach takes a hatchet to the Fed

Jeff Gundlach, the so-called "Bond King" and head of DoubleLine Capital, does not like negative interest rates.

Gundlach, speaking at the Sohn Investor Conference, compared negative yield bonds to disorienting optical illusions designed to make the viewer sick and confused.

"Negative interest rates are the definition of deflation," said Gundlach.

"Trying to combat deflation with deflation is like trying to put out your burning house with gasoline."

Gundlach then took a hatchet to the Federal Reserve, saying that its desire to raise interest rates is a bad idea and will restrict growth.

Gundlach said that given this environment, he said to short utilities and to buy mortgage REITs. Utilities have an 18x price to earnings, according to Gundlach, while mortgage REITs are far more attractive. He expects these two to converge. The "Bond Kong" also suggested investors leverage themselves by 1x in order to grab the most returns.

"Low volatility equities" also fell into Gundlach's gaze, which he called "the ultimate oxymoron."

Gundlach also targeted various presidential candidates from Jeb Bush, saying his slogan should have been "WTF?" instead of "Jeb!", to Ted Cruz, who he compared to a character from "The Munsters", to Hillary Clinton, who he said has a "bottomless" well of scandals to be attacked.

He then reiterated his call that Donald Trump will win the presidency. Gundlach believes that a Trump presidency will cause the national debt to soar.

Gundlach's fund, DoubleLine has just under $100 billion in assets under management and is known for his precise calls on the bond market.