Bill Gross

Re: Bill Gross

Postby winston » Wed Feb 29, 2012 7:20 am

And why would he be right this time, when he was so wrong the last time ?


Pimco's Bill Gross: The No. 1 strategy investors should be using now

Pacific Investment Management Co.'s Bill Gross said investors should embrace a defensive strategy because of the limits of zero-bound interest rates and systemic debt risk in global financial markets.

"An instant replay of these past few decades would have shown that accelerating asset prices weren't due to any particular wisdom on the part of academia or the investment community but an offensively minded Federal Reserve and their global counterparts who were printing money, lowering yields and bringing forward a false sense of monetary wealth that was dependent on perpetual motion," Gross wrote in a commentary posted on Newport Beach, California-based Pimco's website today.

Emphasize income, de-emphasize derivative structures that are fully valued and be willing to accept returns lower than historical averages, Gross wrote.

The period of muted growth in developed economies, high unemployment and orderly deleveraging, Pimco dubbed the "new normal" in the aftermath of the 2008 financial crisis is morphing into a world of credit and zero-bound interest-rate risk, Gross said last month.

"The offensively oriented investment world that we have grown so used to over the past three decades is being stonewalled by a zero bound goal-line stand," Gross, the founder and co-chief investment officer of Pimco, wrote today. "Investment defense is coming of age."


Source: Bloomberg
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Re: Bill Gross

Postby winston » Thu Mar 01, 2012 7:47 am

Pimco's Gross Says It's Time to Play Defense By RANDALL W. FORSYTH

Defense! Defense! That's what investors ought to be chanting now, says Pimco's Bond King and Barron's Roundtable member Bill Gross, after the offense ran up the score over the past three decades during which interest rates fell from historic peaks to virtually zero.

That's not only hit Main Street America, by slashing households' interest income far more than their interest expense, but now Wall Street as well.

Financial institutions such as insurance companies, pension funds and money-market funds find it increasingly difficult, if not impossible, to generate the interest income needed to meet their liability goals or support their business .


Source: Barron's
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Re: Bill Gross

Postby kennynah » Thu Mar 01, 2012 9:10 am

engerish prease

winston wrote:Pimco's Gross Says It's Time to Play Defense By RANDALL W. FORSYTH

Defense! Defense! That's what investors ought to be chanting now, says Pimco's Bond King and Barron's Roundtable member Bill Gross, after the offense ran up the score over the past three decades during which interest rates fell from historic peaks to virtually zero.

That's not only hit Main Street America, by slashing households' interest income far more than their interest expense, but now Wall Street as well.

Financial institutions such as insurance companies, pension funds and money-market funds find it increasingly difficult, if not impossible, to generate the interest income needed to meet their liability goals or support their business .


Source: Barron's
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Re: Bill Gross

Postby winston » Tue Mar 20, 2012 8:51 am

Pimco’s Gross: 30-Year Bull Market for Bonds ‘Probably Over’ By Dan Weil

The three-decade bull market for bonds is nearly over, says bond market legend Bill Gross, co-chief investment officer of Pimco.

“We have been close [to the end] for a number of months,” he tells Yahoo.

Long-term U.S. bond yields across different categories are a little higher than 2 percent. So unless the United States turns into Japan, where yields have dropped to 1 percent, U.S. yields are close to a bottom, Gross says.

“It doesn’t mean the beginning of a bear market, but it does suggest at least that the great bond bull mark since 1981 is probably over.”

To be sure, Gross, who manages the world’s biggest bond fund, Pimco Total Return, is still buying Treasurys. They account for 15 percent to 20 percent of the portfolio, he says.

The alternatives aren’t attractive in Gross’ eyes. Dividend stocks may provide juicy yields, but there’s substantial risk of capital loss.

The price risk isn’t great for Treasurys, and most of it is at the long end of the yield curve, Gross says. So he recommends that investors “center your concentration at five to seven years.”

Many Treasurys traders have turned bearish after the biggest weekly price drop in eight months.

“The data is strong enough not to warrant further assistance” from the Federal Reserve, Sean Murphy, a trader for Societe General, tells Bloomberg. “I don’t think the backdrop is particularly supportive for Treasurys.”

http://www.moneynews.com/StreetTalk/Gro ... /id/432960
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Re: Bill Gross

Postby winston » Wed Mar 28, 2012 8:53 am

Long article. To give you your money's worth ?

Bill Gross: "The Game As We All Have Known It Appears To Be Over" by Tyler Durden

Actually global financial markets are only selectively delevering. What delevering there is, is most visible with household balance sheets in the U.S. and Euroland peripheral sovereigns like Greece. The delevering is also relatively hidden in the recapitalization of banks and their lookalikes.


The total amount of debt however is daunting and continued credit expansion will produce accelerating global inflation and slower growth in PIMCO’s most likely outcome.


In plain speak –

For bond markets: favor higher quality, shorter duration and inflation protected assets.

For stocks: favor developing vs. developed. Favor shorter durations here too, which means consistent dividend paying as opposed to growth stocks.

For commodities: favor inflation sensitive, supply constrained products.

And for all asset categories, be wary of levered hedge strategies that promise double-digit returns that are difficult in a delevering world.


http://www.zerohedge.com/news/bill-gros ... rs-be-over
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Re: Bill Gross

Postby winston » Thu May 03, 2012 6:12 am

Pimco's Gross: US at Risk of Another Credit Downgrade By Forrest Jones

The U.S. could suffer another credit downgrade, similar to the Standard & Poor's decision to strip the country of its coveted AAA rating in 2011, says Bill Gross, founder of Pimco, manager of the world's largest bond fund.

The U.S. is running a structural deficit, a deficit a country would post even while running at full capacity, that is seriously jeopardizing the country's health. Until the government addresses massive liabilities, the country is headed for another downgrade.

Standard & Poor's currently rates the country at AA, while Moody's rates the country at AAA.

"Let's look to the liability structure of the United States. It's not just $15 trillion in terms of current debt, but it's probably three to four times that in terms of Medicare and Medicaid and Social Security," Gross tells CNBC.

"Unless the United States begins to make some inroads, that's called the structural deficit that the CBO and the IMF basically identified as, perhaps 6 percent to 7 percent to 8 percent greater than any other country other than Japan and the United Kingdom — until we address that structural deficit, yes, we're headed to that territory."

Adding to the country's more short-term woes is a fiscal cliff fast approaching.

At the end of this year, the Bush tax cuts are set to expire while automatic spending cuts are due to kick in, a combination that will immediately siphon hundreds of billions of dollars out of the economy and threaten to counter what little growth the economy is posting.

Only Congress and the White House can change that, and not the more autonomous and decisive Federal Reserve. Many worry that nothing will get done during the election year.

Others say the problem is so dire that elected officials will check their egos and political interests at the door and solve the problem quickly.

"I think coming up to the edge of Niagara Falls in the rowboat might finally force Congress and the president to do something," says Keith Poole, a professor at the University of Georgia who has studied political polarization, according to the AFP newswire.

Standard & Poor's downgraded the U.S. in 2011, when the country waited to the last second to raise its debt ceiling and avoid default.

http://www.moneynews.com/StreetTalk/pim ... /id/437696
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Re: Bill Gross

Postby winston » Thu May 10, 2012 6:03 am

Bill Gross: Get ready... QE3 is getting closer

Pacific Investment Management Co.'s Bill Gross and Jan Hatzius at Goldman Sachs Group Inc. (GS) say investors should prepare for additional bond purchases by the Federal Reserve to combat a slowing U.S. economy.

A decision to buy more debt is "getting closer," Gross, who runs Pimco's Total Return Fund, the world's largest mutual fund, wrote on Twitter yesterday.

Hatzius, the chief economist at New York-based Goldman Sachs, predicted in a report the same day that the Fed will announce additional monetary easing when it meets in June.

Source: Bloomberg
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Re: Bill Gross

Postby winston » Wed Sep 12, 2012 7:08 am

The “Bond King”: Buy Gold, Not Bonds by WashingtonsBlog

Bill Gross Says that Gold Holds Its Value, While – In an Era of Central Bank Money Printing- Paper Money Doesn’t

http://www.washingtonsblog.com/2012/09/ ... bonds.html
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Re: Bill Gross

Postby winston » Thu Oct 04, 2012 6:50 am

Pimco's Bill Gross: U.S. "debt addiction" could crush stocks, bonds, and the dollar

Pacific Investment Management Co.'s Bill Gross said the U.S. will no longer be first destination of global capital in search of safe returns unless the gap between spending and debt is addressed.

Major nonpolitical organizations agree that "when it comes to debt and to the prospects for future debt, the U.S. is no 'clean dirty shirt,'" Gross wrote in his monthly investment outlook posted on the Newport Beach, California-based Pimco's website today.

"The U.S., in fact, is a serial offender, an addict whose habit extends beyond weed or cocaine and who frequently pleasures itself with budgetary crystal meth."

The International Monetary Fund, the Congressional Budget Office, and the Bank of International Settlements compute a "fiscal gap," which is a deficit that must be closed either with spending cuts, tax hikes, or a combination of both, which keeps a country’s debt/GDP ratio under control, wrote Gross, the manager of the world's biggest bond fund.

"Unless we begin to close this gap, then the inevitable result will be that our debt/gross domestic product ratio will continue to rise, the Fed would print money to pay for the deficiency, inflation would follow and the dollar would inevitably decline," Gross wrote. "Bonds would be burned to a crisp and stocks would certainly be singed; only gold and real assets would thrive within the 'Ring of Fire.'"

Gross's Ring of Fire includes highly indebted nations such as Spain, Greece, France, the U.K., the U.S., and Japan. Gross has touted his preference for the debt of countries including Germany, Canada, Mexico, and Brazil that have a lower fiscal gap to GDP ratio.

"The U.S. and its fellow serial abusers have been inhaling debt's methamphetamine crystals for some time now and kicking the habit looks incredibly difficult," Gross wrote. The U.S. has $16 trillion of outstanding debt and owes an additional $60 trillion based on its present value of future liabilities of Social Security, Medicare and Medicaid, he said.

"Altogether, that’s a whopping total of 500 percent of GDP," he wrote.

'Fiscal Cliff'

"Well, Armageddon is not around the corner," Gross said. "I don't believe in the imminent demise of the U.S. economy and its financial markets. But I'm afraid for them."

To keep the debt/GDP ratio in the U.S. at a manageable level, Gross recommended cutting spending or raising taxes by 11 percent of GDP over the next five to 10 years.

Even with the approaching the fiscal cliff, the U.S. is still considered the world's "cleanest dirty shirt," with federal debt/GDP ratio less than 100 percent, Aaa/AA+ credit ratings, the world's reserve currency, and its 8 percent of GDP deficit, Gross wrote.

Yet, the GDP deficit rises to 11 percent when Social Security and health-care costs are totaled and if the debt problem isn't addressed, the U.S. will begin to resemble Greece before the turn of the next decade, he said.

The fiscal cliff refers to an event in which taxes are set to rise and spending cut by $1.2 trillion if the U.S. Congress fails to agree by Dec. 31 on ways to reduce the deficit.


Source: Bioomberg
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Re: Bill Gross

Postby winston » Fri Oct 12, 2012 6:10 am

Bill Gross Says Gold Will Thrive in ‘Ring of Fire’ by Chris Vermeulen

Bill Gross Says Gold Will Thrive in ‘Ring of Fire’

Gross is also known for speaking quite bluntly about the United States’ growing debt problem.

His latest monthly market commentary came with a warning for the U.S. and investors alike. Gross stated that a number of recent studies have concluded that “The U.S. balance sheet, its deficit and its ‘fiscal gap’ is in flames and that its fire department is apparently asleep at the station house.”

http://thedailygold.com/bill-gross-says ... g-of-fire/
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