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World's Largest Bond Fund Manager Heads For The Lifeboat. PIMCO abandons US Treasuries
American Thinker ^
| 03/10/2011
| Tom Shuhadlonik
Posted on 03/10/2011 6:52:19 AM PST by SeekAndFind
Bill Gross manages the world's largest bond fund. If you own bonds in your retirement, either through his PIMCO fund or some other branded variant, there is a good chance he manages some of your money. Yesterday he announced he has abandoned the US bond market in his largest fund. As of January 2009, his $237 billion Total Return Fund held zero government related debt.
People expecting a stampede from the US bond market are going to be disappointed. Bond holders are not a herd of animals who follow each other blindly. Bond holders are a mass of individuals with differing opinions and levels of sophistication. If the US bond market collapses it will be more subtle.
The US bond market is akin to the Titanic. Bill Gross is a first class passenger who sensed the danger after the collision and acted on it. He didn't run for the lifeboats screaming. He casually made his way out of the ballroom; all the while smiling and engaging in cocktail party banter. He has donned his lifejacket and taken his seat in a lifeboat long before most passengers and crew realized they were in mortal danger.
Last night most of the other fund managers were still in the ballroom drinking and laughing as the crew and captain assured them all is well. The poor retail investors were locked in steerage mostly unaware of their impending fate. This morning the folks in first class will notice Bill Gross has left the party and the mood will subtly change. The crowd will soon start to drift towards the exits.
But even if more of the passengers are now aware of the danger they all face one immutable fact. There are simply are not enough lifeboats to save everyone.
Tom Suhadolnik
TOPICS: Business/Economy; Culture/Society; Government; News/Current Events
KEYWORDS: billgross; bondmarket; pimco; ustreasuries
To: SeekAndFind
The Stock Market says..................
2
posted on
03/10/2011 6:58:39 AM PST
by
Red Badger
(How can anyone look at the situation in Libya and be for gun control is beyond stupid. It's suicide.)
To: Red Badger
We should thank Obama for the manufactured crisis and not letting it go to waste!
To: SeekAndFind
Very interesting. Thanks for posting. Financial musical chairs BUMP!
4
posted on
03/10/2011 7:16:14 AM PST
by
PGalt
To: PGalt
Don’t forget someone bought the bonds. They might have gotten the deal of the century.
5
posted on
03/10/2011 7:17:43 AM PST
by
frposty
(I'm a simpleton)
To: SeekAndFind
This steerage has been sitting in the lifeboat since 2008.
6
posted on
03/10/2011 7:19:26 AM PST
by
RC one
(CHANGE WE CAN BELIEVE IN! YES WE CAN! FUBO!)
To: Red Badger
Dow down 200+, PMs down, USD is UP. That 54B has got a lot of people thinking.
7
posted on
03/10/2011 7:21:00 AM PST
by
Chunga85
("Foreclosure Fraud", TARP, "Mortgage Crisis", Bailout)
To: himno hero
Bush, Greenspan, Dennis Hastert, Trent Lott.....boatloads of go a bit slower, spend a touch less Republicans.
8
posted on
03/10/2011 7:22:00 AM PST
by
Leisler
(Our debts are someone's profit. Follow the money, the vig.....)
To: frposty
I heard that Portagul is offering near 8% on two year.
But, guess this. The ECB is the buyer of 80% ( ECB QE )
9
posted on
03/10/2011 7:24:16 AM PST
by
Leisler
(Our debts are someone's profit. Follow the money, the vig.....)
To: Chunga85
Dow down 200+, PMs down, USD is UP. That 54B has got a lot of people thinking.>>>>>>
Markets, copper and commodities are in deflation mode today ...Today at least the market is saying we are getting no QE3. Which is what PIMCO said and more importantly acted on by dumping US Treasuries
Though in a pure deflation US Treasuries should go up in value. Bill Gross is saying (I guess) that interest rates are going up when the Fed stops buying.
10
posted on
03/10/2011 7:27:30 AM PST
by
dennisw
( The early bird catches the worm)
To: SeekAndFind
This same bond fund did the same thing in Jan 2009. And the world didn’t end.
11
posted on
03/10/2011 7:27:39 AM PST
by
DannyTN
To: frposty
Good point. Thanks.
might
12
posted on
03/10/2011 7:32:10 AM PST
by
PGalt
To: dennisw
It’s impossible to figure out. Has he created a phony flight to the USD? If so, there must be some diabolical purpose for it. I’m still long on physical Soylent Green.
13
posted on
03/10/2011 7:35:08 AM PST
by
Chunga85
("Foreclosure Fraud", TARP, "Mortgage Crisis", Bailout)
To: Chunga85
That’s nothing! I took delivery on my Soylent Green and stashed it in my fallout shelter next to the crackers and cheeze whiz and grape soda
14
posted on
03/10/2011 7:44:51 AM PST
by
dennisw
( The early bird catches the worm)
To: SeekAndFind
As of January 2009, his $237 billion Total Return Fund held zero government related [sic; should read "government-related"] debt. Old news!
Regards,
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