Seeking Alpha

More trouble at Pimco

  • It turns out it was three, not two lined up to be deputy CIOs to Bill Gross amid the departure of Mohamed El-Erian. One - Marc Seidner - resigned in January just hours before he was to be publicly announced in his new position. Seidner - who followed El-Erian to Pimco in 2009 - reportedly had found working there increasingly difficult over the last 18 months, with Gross becoming "increasingly illogical and irrational."
  • In other news Pimco has lost a $1.3B bond fund mandate to TCW.
  • Pimco's parent: Allianz (AZSEY)
  • Among Pimco's closed-end offerings are: PTY, PDI, PMF, PGP, PKO, PFL, PFN, PCN, PCM, PHK, RCS, PMF, PML. There's also the ETF version of Bill Gross' Total Return Fund: BOND.
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Comments (9)
  • Transcripts&10-K's
    , contributor
    Comments (843) | Send Message
     
    And any lingering questions about this whole situation have now gone out the window...
    20 Mar 2014, 04:44 PM Reply Like
  • Land of Milk and Honey
    , contributor
    Comments (5217) | Send Message
     
    Sounds possible Gross is dealing with an age-related medical cognitive issue.
    20 Mar 2014, 05:20 PM Reply Like
  • Edub
    , contributor
    Comments (29) | Send Message
     
    I cashed out of all Pimco funds in recent weeks. A Fidelity advisor tried to talk me out of departing from a couple funds because they have superior managers. However, I argued that it has become pretty apparent that they all operate at the whim of a brutal dictator that does not tolerate a dissenting opinion.

     

    Who knows when Bill Gross will order all his minions to do something irrational and more damaging. To protect their investment, Allianz probably needs to step in and make some changes ... and sooner rather than later ... before the redemptions become a floodgate.
    20 Mar 2014, 05:45 PM Reply Like
  • NYer1
    , contributor
    Comments (1358) | Send Message
     
    Well, the Genie has been let out of the oil lamp with ElArian's departure.
    It looks increasingly likely that Gross has alienated top talent at the firm and as we get more and more stories like that ( see today's article in the Financial Times of London : http://on.ft.com/1r1ee14 ), it begs to question whether Gross (and Pimco) would be too busy with trying to control damages and too distracted to be able to manage the Pimco funds.
    My bet is we would see Gross "promoted" somehow to an Executive position in Allianz thus giving up portfolio management duties. It might take some time but the reputational damage and business cost of these revelations would eventually prove too much for Pimco or Allianz to bear.
    20 Mar 2014, 05:50 PM Reply Like
  • jpkirsch
    , contributor
    Comment (1) | Send Message
     
    It is inconceivable that if Gross is having real medical issues, Allianz will not take action to prevent a run on the funds. That said, the PIMCO funds are more like whales than minnows, and it would take time and considerable reallocation to change the course that they are on, a course that is a proven money-maker. If there is a panic-driven run on the funds, it might be the right time to scoop up some bargains.
    20 Mar 2014, 07:39 PM Reply Like
  • Land of Milk and Honey
    , contributor
    Comments (5217) | Send Message
     
    jpkirsch

     

    if there's a run, definitely time to look into scooping them up.

     

    On medical issues, when it hits cognitive, it can be surprisingly long for those closest to even see it as that. Sadly. When it comes on slowly, it's particularly missed & becomes "their personality."
    20 Mar 2014, 07:48 PM Reply Like
  • user245
    , contributor
    Comments (2) | Send Message
     
    myself and my brother have owned phk for quite a while , hope this whole thing blows over. pays a nice dividend, but can be very volatile.
    20 Mar 2014, 10:08 PM Reply Like
  • hollowaya
    , contributor
    Comments (22) | Send Message
     
    Yes I'M in the same camp as you both. Also agree with the part
    regarding dividend, but not about volatility.
    21 Mar 2014, 06:40 AM Reply Like
  • hollowaya
    , contributor
    Comments (22) | Send Message
     
    Have a good portion of investment in PIMCO. With ELArain gone will stay
    in for now. However, will hold off from more funds invested.
    Gross has always seemed to be ethical person. Hopefully this is only a short
    lived problem!!!!
    21 Mar 2014, 06:21 AM Reply Like
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