If you had thrown a dart at a global stock market dartboard and hit the S&P 500 in January 2017, you'd be up 17 percent and yet "you'd be unlucky," said Jeffrey Gundlach, the CEO of DoubleLine Capital, speaking to advisors yesterday at the annual Schwab Impact conference.

The perception of a synchronized global expansion is an accurate one, he said, and many countries can claim they have better economies and equity markets than America—at least for now. Growth around the world isn't just expanding, "it's accelerating," Gundlach said.

His best investment idea at present is emerging market equities, particularly India’s. But he raised a number of concerns about trends surfacing in the developed markets that had caught advisors' attention.

Even Europe, often seen as the sick man of the global economy, is today posting strong manufacturing and retail sales gains. Germany's main business climate index, created in the early 1990s, is setting all-time records.

Yet the European Central Bank is maintaining negative interest rates while employing quantitative easing strategies more than eight years after the financial crisis ended.

It is particularly strange because the Fed is going in exactly the opposite direction, pursuing a "double-barreled" policy of quantitative tightening (QT) while raising interest rates. Gundlach described this central bank divergence as "kind of weird."

A few advisors in the room wondered, however, if the blatant lack of coordination between the world's two largest central banks might set them on a collision course and produce something far worse.

ECB chief Mario Draghi has said he plans to pursue his aggressively dovish policy until September 2018 and indicated that QE will remain in effect longer than that. Things could change if, as expected, the next ECB president is German.

Almost all economic indicators are "flashing positive," and there is "very little evidence" of a recession in the next six months. Yet Gundlach said all that can change very quickly.

One of his favorite recession indicators is the spread between junk bonds and Treasurys, which typically widens sharply in the months before a recession begins. Though these spreads have widened marginally in recent weeks, the moves are hardly significant enough to draw conclusions.

The general consensus among other investors is that U.S. and European junk bonds have become severely overvalued as yield-starved global investors bid up prices. Other recession indicators include the shape of the yield curve and commodity prices.

Gundlach pointed to several signals a global bubble could be percolating. A relative recently told his 86-year-old mother to sell all her assets and buy Bitcoin.

And a new futures contract on “FANG-Plus” stocks (referring to Facebook, Amazon, Netflix and Google) will soon start trading. Gundlach displayed a uranium chart revealing that uranium prices peaked years ago at exactly the same time uranium futures were first issued.

What he didn't say: The last time the global economy expanded in this kind of synchronized fashion was 2007.

He then turned to a concern he has raised in the past. In 2018 and 2019, about $675 billion in 10-year Treasurys issued during the financial crisis will need to be refinanced, and it will happen at the same time the Fed is trying to raise and shrink its balance sheet. Gundlach predicted the central bank will allow some of those securities to "roll off" its balance while it will repurchase the rest.

But a perfect storm could be brewing. It just so happens that in 2018 and 2019, the huge middle bulge of the baby boom generation also will turn 65 years old and go on Medicare, placing huge strains on America's entitlement system.

This conundrum, combined with other factors, could lead to a 2019 recession, though he didn't give any odds on one. It's worth noting that the current expansion is already 100 months old.

At the same time, the federal budget deficit is starting to expand substantially, and Washington is immersed in cutting taxes. A tax cut will only expand the deficit, Gundlach said, rejecting the notion it could increase government revenues. He debunked those who cited Reagan's tax cuts as deficit-reducing, producing a chart showing the deficit climbed from about 30 percent of GDP to 60 percent during his administration.

Commodities have appear to have reached a secular bottom, and Gundlach said there are similarities between their prices before previous booms and their current prices. Industrial commodities, in particular, are booming. However, he also noted commodity prices "accelerate" almost every time before a recession, though the two trends are not always in lockstep.

Both commodities and emerging markets were white-hot in the 2010-2011 period shortly after the financial crisis, Gundlach observed, and both have stalled since then. Instead, the S&P 500 emerged as global investors' favorite place to be as it rose 33 percent in 2013. After a 15 percent correction in early 2016, the S&P has surged almost 40 percent and Gundlach expects market leadership to shift.

So what makes emerging market stocks Gundlach's favorite bet? For starters, the Shiller CAPE ratio (the cyclically adjusted price to earnings ratio) in emerging markets is around 15, or half that of the S&P 500, which stands at 30.

And consider Warren Buffett's favorite metric: the market capitalization to GDP ratio. In developed markets, all equities equal about 100 percent of GDP; in emerging markets, however, that figure is 40 percent.

India remains Gundlach's favorite investment, and he predicted its market will appreciate 1,000 percent over the next 20 years. The country is in a stage of development that shares many similarities with China 20 years ago.