America's bond king wants to borrow 'a quintillion dollars'

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Even the bond king is weirded out by the market these days.

Jeffrey Gundlach, the CEO of investment firm DoubleLine, poked fun at one of the extreme oddities of 2015: Some interest rates have defied gravity and gone negative.

That means instead of paying out interest, certain bond issuers like Germany and Nestle are effectively making money when they borrow from investors. It's the exact opposite of how the bond market is supposed to work.

"I would like to borrow several quintillion dollars at negative interest rates. If Germany can borrow at negative, then why can't we?" Gundlach said on Tuesday evening during a webcast with DoubleLine investors.

A quintillion dollars is more money than you can fathom. It's a 1 with 18 zeroes after it and comes after trillion and quadrillion. But before you cue Mr. Burns from the Simpsons or Dr. Evil from Austin Powers, Gundlach assured his listeners that he was "obviously being somewhat facetious."

Related: Pay attention to the chaos in the bond market

'Fools' bought German bonds: Gundlach's comments highlight just how wild the bond markets are this year.

The "going negative" phenomenon has been driven by fears about Europe's economy. Some worried so much about deflation in Europe that they thought they would lose less money by purchasing bonds with negative rates than holding onto cash. Then the European Central Bank stepped in with additional emergency moves that lowered yields further.

Short-term government bonds in Belgium, Denmark, France, Germany and Sweden all currently have negative yields, a sign of a bond rally. (Yields fall when bond prices rise.)

Related: Worried about stocks? Bonds look worse

But reading the bond market has been difficult lately. Just two months ago, the 10-year German bond yield flirted with negative territory. After a dramatic turnaround, it spiked above 1% on Wednesday for the first time since September.

"A lot of fools bought German bonds at yields in the single digits for the 10-year thinking somehow they would go negative. That hasn't worked out," Gundlach said.

The wave of selling has slammed American bonds, too. The 10-year Treasury yield touched 2.46% on Wednesday -- the highest level since last fall.

Related: The crazy world of negative rates: Banks pay your mortgage?

Maybe the bond bubble isn't popping? While Gundlach thinks it's silly for rates to go negative, he believes the sell-off in the bond market may be overdone.

"My guess is that the ceiling on rates will be hit this week potentially," he said.

That means Gundlach doesn't think it's smart for investors to dump their bond holdings just because yields have been spiking higher lately. He believes a bond rally will carry the yield on the 10-year Treasury back to where it started 2015, roughly about 2.19%.

Gundlach feels good about his call, unless the bond sell-off deepens further.

"Get very scared if the 10-year accelerates above 2.6%," he said.

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