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Interest rates to remain subdued for long time: Gross

In his latest investment outlook, Bill Gross said he expects interest rates to remain subdued for a long time, which should limit the risk of a bear market in stocks.

July 03, 2014 10:25 IST | India Infoline News Service
Investors pulled $4.5 billion from Grosss Pimco Total Return Fund in June, marking the 14th consecutive month of outflows.
Assets in the flagship bond fund at Pacific Investment Management Co. fell to $225.2 billion at the end of June.
Pimco founder and CIO, Bill Gross said he sees bubbly pockets in the market. According to Gross, there can be tight conditions which restrict a company in terms of their ability to lever going forward.
In his latest investment outlook, Gross said he expects interest rates to remain subdued for a long time, which should limit the risk of a bear market in stocks.
The era of income may be, at the margin, replacing the era of capital gains, despite artificially low current yields.
If the real New Neutral is significantly lower than 10 or 20 years ago, P/E ratios should be higher, credit spreads should be tighter, and home prices less bubbly than presumed if, in fact, The New Neutral is neutral and can lead to historical levels of asset volatility. The New Neutral is critical to future investment success. This currently is PIMCOs one big idea, Gross added.

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