- "Investors are all playing the same dangerous game that depends on a near perpetual policy of cheap financing and artificially low interest rates in a desperate gamble to promote growth," writes Bill Gross (BOND) in his monthly letter. "If monetary and fiscal policies cannot produce the real growth that markets are priced for (and they have not), then investors at the margin - astute active investors like PIMCO, Bridgewater and GMO - will begin to prefer the comforts of a less risk-oriented migration."
- "Deep in the bowels of central banks, research staffs must lay the unmodelable fear that zero-bound interest rates supporting Dow 16,000 stock prices will slowly lose momentum after the real economy fails to reach orbit, even with zero-bound yields and QE."
- What Gross and Pimco are most confident about and what they're betting on is the idea the Fed will maintain ZIRP at least until 2016. "Front-end load portfolios. Don’t fight central banks, but be afraid."
- Short-duration Treasury ETFs: SHY, BIL, SHV, VGSH, SCHO, DTUL, SST, TUZ, DTUS
- Intermediate and long-term Treasury ETFs: TBT, TLT, TMV, IEF, TBF, PST, EDV, TTT, TMF, TLH, ZROZ, SBND, IEI, DLBS, TYO, DTYS, VGLT, UST, UBT, TLO, TBX, VGIT, GSY, DTYL, LBND, SCHR, TYD, TENZ, ITE, TYBS, FIVZ, TBZ, DFVL, DLBL, DFVS, TYNS
Gross: Fears lurk "deep in the bowels of central banks"
Dec 3 2013, 09:22 ET