Bill Gross’ March Investment Outlook – Spread Convergence
by ilene - March 1st, 2010 9:43 am
Bill Gross’ March Investment Outlook – Spread Convergence
Courtesy of Tyler at Zero Hedge
The bond king’s trade recommendation: the yield convergence trade between the guarantor nations and the guarantee nations. Additionlly, expect a convergence between government spreads and agency/corporate yields. Is this a sea change in the way credit is approached? Somewhat yes; then again, even though he is ostensibly absolutely right, haven’t many (ahem LTCM) already tried this and failed?
Full PIMCO March letter:
I haven’t gone to a cocktail party in over 10 years. Granted, perpetually watching Seinfeld reruns on Friday and Saturday nights makes for a dull boy, but the alternative is excruciating. Uh, which would I prefer – solitary confinement or water boarding? I lean strongly in the direction of a warm bed and peace as opposed to a glass full of tinkling ice cubes and a room resonating with high-decibel blather. I suppose the parties wouldn’t be so bad if there was something original to be said, or if “you” had a genuine interest in “me” as opposed to “you,” but let’s face it folks, no one does. The only reason any of us really cares about cocktail conversations is to quickly redirect someone else’s stories into autobiographies that we assume to be instant bestsellers if only in print. If not, if the doe-eyed listener seems simply fascinated by what you’re saying, you can bet there’s a requested personal favor coming when you finally shut up. “Say Bill, I was wondering if you knew somebody at…that could…” Yeah right! But, as my chart shows, 90 seconds into a typical conversation, no one gives a damn about you and your problems – maybe those shoes and that dreadful eye shadow you’re wearing, but not anything audible coming out of your mouth.
During that unbearable minute-and-a-half, however, you’re likely to have covered some of the following topics:
- Where are you from? (If it’s not a place where I’ve been or have a distant second cousin – don’t care.)
- How’s the family? (If Johnnie is in advanced placement courses and my kids aren’t – don’t care. Don’t care about your kids’ soccer games either or that upcoming wedding.)