Gross: Zero-Bound Rates Will Cause Big Trouble

PIMCO bond guru Bill Gross is reiterating his belief that zero-bound interest rates will become a major problem for the economy, and markets. “Books such as ‘Stocks for the Long Run’ or articles such as ‘Dow 36,000’ captured the public’s imagination much like a Montana to Jerry Rice pass that always seemed to clinch a 49ers victory,” Gross writes in a football-analogy-heavy issue of his investment commentary, discussing the climate of falling interest rates and rising asset prices that has dominated the past few decades. “Yet an instant replay of these past few decades would have shown that accelerating asset […]

Paulsen Still Likes Financials and Cyclicals

Wells Capital Management’s James Paulsen thinks cyclical stocks will continue to outperform the broader market for some time. Paulsen tells Yahoo! Finance’s Breakout that cyclicals tend to outperform as long as unemployment claims are trending downward, and thinks it won’t be time to get more defensive until new claims for unemployment get down below the 300,000 per week range. He likes the financial sector, and he also discusses why he thinks dividend stocks may be overhyped right now.

Ritholtz: Markets “Don’t Give A Flying Fig” About Election Polls

As the 2012 Presidential election draws closer and closer, the usual rhetoric about one candidate being better than another for the stock market is, as always, a big issue in the press. But in a recent Washington Post column, Barry Ritholtz of FusionIQ and The Big Picture blog says it’s a lot of nonsense. “Markets do not rally or sell off because one candidate or the other is more likely to win,” Ritholtz wrote. “This might strike some as a bit radical, but here it is: Markets don’t give a flying fig about any of this nonsense.” One commonly cited […]

Achuthan, ECRI Stand Pat On Recession Call

Lakshman Achuthan of the Economic Cycle Research Institute says that, despite all the positive economic reports we’ve seen recently, several key indicators show the economy is actually on the decline and headed into recession. Achuthan says GDP numbers, personal income growth, sales data, and industrial production have all been on the decline and paint a picture very similar to those that preceded past recessions.

Gross vs. Cooperman on Treasurys

Are Treasury bonds a good place to be, or quite dangerous? Two top strategists — Bill Gross and Leon Cooperman — have very different takes. Hedge fund guru Cooperman tells Bloomberg that Treasurys will be the worst place to put their money for the next three years. He says the Federal Reserve is trying to bolster asset prices, and he thinks they’ll be successful, creating significant inflation in the next couple years. With yields so low, Treasury investors face a major erosion of their purchasing power if inflation rises. He likes equities and gold over Treasurys. “Bond King” Gross, however, […]