Gross: Bond Bull Is Ending

PIMCO “bond king” Bill Gross says that the bull market in bonds is ending. Gross tells Bloomberg that, without additional quantitative easing, he thinks treasury bonds will decline in yield as the economy slows, which will push credit spreads higher. He sees a 12-month period ahead where combined treasury, corporate, and high yield bonds “don’t move much”. Gross also says the stock market has been rising in part because of economic improvement, and in part… Read More

Gross on the “Credit Supernova”

In his latest Investment Outlook, PIMCO’s Bill Gross says that the U.S. is heading toward a “credit supernova”, with exponentially rising amounts of credit leading to an eventual implosion of deleveraging. Gross says that over the years, the U.S. has used more and more credit to produce less and less growth. In the early 1970s, credit outstanding in the U.S. totaled $3 trillion, he says. “Today, at $56 trillion and counting, it is a monster… Read More

Gross’ Forecasts for 2013

PIMCO’s Bill Gross says the “New Normal” should continue in 2013, and he expects both stocks and bonds to return less than 5% for the year. Gross also sees unemployment staying at 7.5% or higher during the year, and thinks gold will rise. He also discusses the fiscal cliff bill, and says that the drawn-out, contentious process of creating it “reaffirmed [members of Congress’] ineptitude”.  

Gross Talks Debt, Asset Allocation

PIMCO’s Bill Gross says that if the U.S. doesn’t reverse its big deficits and rising debt, it “could resemble Greece within a decade.” In an interview with U.S. News & World Report, Gross also says he doesn’t think the “New Normal” will end anytime soon. “Don’t think that anytime soon we’re going back to the ‘old normal’ because these cycles of de-levering are biblical in nature,” he says. “An investor probably has to look forward… Read More

Gross Talks Stocks, Bonds, Gold & Inflation

PIMCO bond guru Bill Gross says that both stocks and bonds are a bit “bubbled” because of the Federal Reserve’s policies, but that high-quality dividend-paying stocks should perform better than bonds over the long haul. Gross tells CNBC’s Futures Now that he also thinks gold and real assets are offering good long-term protection against inflation, which he sees ahead for the U.S.  

Gross: Close the Gap, or Become Like Greece

PIMCO bond guru Bill Gross says the U.S. needs to close its “fiscal gap” quickly, or risk a Greece-like debt crisis. In his latest investment commentary, Gross says that he doesn’t think “Armageddon is … around the corner. I don’t believe in the imminent demise of the U.S. economy and its financial markets.” But, he says, he’s afraid. He points to reports from the International Monetary Fund, Congressional Budget Office, and Bank of International Settlements… Read More

Gross: Follow the Fed and ECB

Bill Gross says PIMCO’s strategy is pretty simple: Buy what the Federal Reserve and other central banks are buying. “We continue to anticipate what the Fed is buying,” Gross recently told CNBC. “They’ve told us they will buy $40 billion to $70 billion of agency mortgages every month until the cows come home. It pays to own these mortgages even though they’re overvalued.” Another area PIMCO is looking, thanks to central banks: Spanish and Italian… Read More

Bond Guru Offers Counterpoint to Inflation Argument

Jeffrey Gundlach thinks interest rates will soon rise, but, unlike fellow bond guru Bill Gross, he doesn’t think inflation is upon us. Gundlach, in a web seminar, recently said that a paradigm shift has occurred in the past five years or so, according to AdvisorOne. “Over the majority of the [past three decades or so] we’ve seen a benign inflation period characterized by stable to falling interest rates,” he said. “It’s quite likely interest rates… Read More

Gross on the Problem with Low Interest Rates

PIMCO bond guru Bill Gross is standing by his comments that the “cult of equity is dying”, saying that near-zero interest rates are stunting lending and growth, and leading to lower returns for both stocks and bonds. “Last month’s “dying cult of equity” Investment Outlook elicited a lot of excitement, but somehow failed to impress readers with its main point: Returns from both stocks and bonds will be stunted,” Gross writes in his September Investment… Read More

GMO: Death of Equities “Greatly Exaggerated”

Bill Gross’ claim that the cult of equities is “dead” has generated a lot of response recently, and now Jeremy Grantham’s GMO has entered the fray, countering many of Gross’ key points. “Disappointing returns from equity markets over a period of time should not be viewed as a signal of the ‘death of equities,’” Ben Inker writes in a white paper on GMO’s web site. “Such losses are necessary for overpriced equity markets to revert… Read More