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  • The Concentrated Portfolio Of Great Companies [View article]
    Hi dbchambers,

    Thanks for the comments. There are some other companies that I plan on adding to the list in the future, but want to write specific articles on them first.

    I agree about utilities. As I mentioned in the previous comments, I am not convinced about healthcare, but I have an open mind.

    Regarding energy, I don't want to put commodity companies on this list. Some MLPs (pipelines) could be candidates, but I don't like K-1s.
    Aug 21, 2013. 10:01 AM | Likes Like |Link to Comment
  • The Concentrated Portfolio Of Great Companies [View article]
    Hi The-Mick,

    Thanks for the comments. Nice approach.
    Aug 21, 2013. 09:50 AM | 1 Like Like |Link to Comment
  • The Concentrated Portfolio Of Great Companies [View article]
    Hi Martin Inc.

    Thanks for your comments.

    Regarding technology, the issues for the long term are product cycles and inflation. Product cycles in the tech world change so quickly, so it is hard to think about holding those companies on a multi-year and multi-decade timeframe. The news about Kodak emerging from bankruptcy is a reminder of this. I know that GM went through bankruptcy and it is on my list, but cars were around before the recession and they are around now. GM's had problems, but cars are not going away (yet).

    Also, many tech have products that experience deflation. I am more confident that my toothpaste and coffee is going to cost more 10 years from now than any tech product. If I am investing for the long term, then I want inflation on my side.

    The answer about healthcare is more complicated. I invest very rarely in healthcare. I recognize that people can make money investing in healthcare, but I am much more comfortable with other industries than healthcare. Also, healthcare (especially pharma and biotech) has the same product problem as tech. That said, I am open to investing in healthcare for the long term and would be happy to hear the pitch about candidate to add to the list.
    Aug 21, 2013. 09:47 AM | 2 Likes Like |Link to Comment
  • The Concentrated Portfolio Of Great Companies [View article]
    Hi csv26,

    Thanks for the comment. It is concentrated in certain parts of the market and I don't think that 17 is too much.
    Aug 21, 2013. 07:37 AM | Likes Like |Link to Comment
  • Bill Gross's Perspective On The 10-Year Treasury [View article]
    Hi wdchil,

    Thanks for the comments.

    The 10-year yield is going to rise/fall depending on what bond investors are willing to pay for bonds. Bond investors/traders may drive up the yield, regardless of the impact on the economy.

    I don't think a 4% yield would be a disaster for the economy, but it may be bad for stocks.

    If yields get too high, then I expect the Fed to try and talk them down. It is yet to be determined if they will be successful.

    Looks like the 10-year wants to get to 3%. If buyers don't come in at that level, then there could be a quick move to 3.5%.

    I agree that nobody (not Gross and, certainly, not me) can predict the bond yield. Best to have a plan B if wrong. I may certainly be wrong.
    Aug 20, 2013. 06:59 PM | 1 Like Like |Link to Comment
  • Bill Gross's Perspective On The 10-Year Treasury [View article]
    Hi Rich W,

    Thanks for the comments.
    Aug 20, 2013. 09:53 AM | Likes Like |Link to Comment
  • Bill Gross's Perspective On The 10-Year Treasury [View article]
    Hi Chris,

    Thanks for the comments. I agree that it is better to wait for a bottom in bond prices (top in bond yields) before getting in the market. I prefer to be a bit late than early.
    Aug 20, 2013. 09:53 AM | 1 Like Like |Link to Comment
  • Bill Gross's Perspective On The 10-Year Treasury [View article]
    Hi Kevin, thanks for the info.
    Aug 20, 2013. 09:51 AM | Likes Like |Link to Comment
  • Bill Gross's Perspective On The 10-Year Treasury [View article]
    Hi whiff,

    Thanks for the comments.
    Aug 20, 2013. 09:51 AM | Likes Like |Link to Comment
  • Bill Gross's Perspective On The 10-Year Treasury [View article]
    Hi ricksteph,

    Thanks for the comments. Yes, Gross (and other big bond managers) have been wrong about Treasuries over the summer (and at other times). I still have a lot of respect for him, even when I disagree. I am not an expert on bonds and he sure is.
    Aug 20, 2013. 09:50 AM | 1 Like Like |Link to Comment
  • Disaster Scenario For Treasury Bonds: Is The 10-Year At 2.83% A Trigger Or Trap? [View article]
    Hi Guardian3981,

    My view on inflation is as follows:

    1. Inflation in the real economy is higher than the Fed's ~1-2% official gauge.
    2. I see a lot of pricing increases out there and I expect that to continues.
    3. The Fed cares a lot about wage inflation, but there is not much wage inflation because of the unemployment rate.
    4. If the unemployment rate drops, we will start to see more wage inflation (but we probably need to get to the mid 6% range for that).
    5. I don't expect run away inflation, because there is too much slack.
    6. I don't expect the fed's official inflation numbers to reflect the inflation rate that I feel, but that doesn't make the 10-year attractive in the 2% range.
    Aug 19, 2013. 11:48 AM | Likes Like |Link to Comment
  • Disaster Scenario For Treasury Bonds: Is The 10-Year At 2.83% A Trigger Or Trap? [View article]
    Hi darnoc111,

    Thanks for the comments. I will explain what I meant by the Fed losing control of interest rates.

    The Fed has been trying to keep interest rates low. It keeps short term interest rates low by keeping the fed funds rate low and it tries to keep long term rates low by forward guidance and QE.

    It is possible that the Fed thought that long term interest rates were too low earlier this summer and that is why they started talking about tapering.

    Nonetheless, I don't think the Fed wants higher yields on the 10-year. When the bond market started to collapse earlier this summer, Bernanke and other Fed officials tried to convey the message that tapering is not tightening to tray and keep long term interest rates low.

    However, the 10-year (and long term interest rates) have been rising. I don't think the Fed wants the 10-year to rise more at this point. However, the Fed forward guidance and the "tapering is not tightening" line has not yet worked to bring down bond yields.

    That is why I said the Fed lost control of the 10-year. Of course, the Fed could regain control. It could buy more bonds, but I don't think that is likely. The Fed seems more likely to taper than buy more bonds.

    It could also make a statement that it will keep interest rates low until unemployment hits 6% or 5%.

    I agree that there could be a rush for the exits in the bond market. I like the phrase "selling begets selling." We'll see if it happens.

    In summary, the longer the 10-year stays above 2.75% the greater the probability of higher rates.
    Aug 19, 2013. 11:04 AM | Likes Like |Link to Comment
  • Disaster Scenario For Treasury Bonds: Is The 10-Year At 2.83% A Trigger Or Trap? [View article]
    Hi Guardian3981,

    That is a good question and I have been thinking a lot about it. I thought that we may see some more buying in the 2.45% - 2.75% range considering, which could have driven down yields. But, the 10-year broke out of that range pretty quickly.

    From a long term technical standpoint, it seems that the next big resistance area is around 3.5% - 4%.

    There could be some buying when/if the 10-year hits 3%. Some people may want to pick up the 10-year with a 3 handle on the yield.

    From a fundamental perspective, I think that the fair value is somewhere around 3.5%. I still think inflation will be in the 2-3% range, so the 10-year should offer a higher yield.

    Hard to tell if the fundamentals matter at this point.

    Also, if yields go up, I expect the momentum to overshoot to the upside.
    Aug 19, 2013. 09:57 AM | Likes Like |Link to Comment
  • Disaster Scenario For Treasury Bonds: Is The 10-Year At 2.83% A Trigger Or Trap? [View article]
    Interesting data on bond ETF outflows:

    Bond exodus accelerates as yields creep near 3%

    http://yhoo.it/14cPysq
    Aug 19, 2013. 08:10 AM | Likes Like |Link to Comment
  • Disaster Scenario For Treasury Bonds: Is The 10-Year At 2.83% A Trigger Or Trap? [View article]
    After interest rates started spiking earlier this summer Bernanke and the Fed tried to convey the message that tapering is not tightening and that they will keep interest rates low for a while.

    I am hearing more and more market strategists saying that the Fed may lower the target for the unemployment rate. I have no idea if this is a real possibility, but it could help calm the bond markets if rates continue to rise. It is certainly a risk to the rising rates scenario.
    Aug 18, 2013. 11:55 PM | Likes Like |Link to Comment
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