U.S. Must Spend to Avoid Mini Depression, Gross Says

Discussion in 'Economics' started by ByLoSellHi, Feb 5, 2009.

  1. Anyone think ole' Bill may be short long bonds?


    U.S. Must Spend to Avoid Mini Depression, Gross Says (Correct)
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    By Kathleen Hays and Dakin Campbell

    (Corrects spelling error in headline.)

    Feb. 5 (Bloomberg) --
    Bill Gross, co-chief investment officer of Pacific Investment Management Co., said the U.S. may slump into a “mini depression” unless policy makers spend trillions of dollars to spur growth.

    “This economy needs support from the government, a check from the government in the trillions,” Gross said today in a Bloomberg Television interview from Pimco’s headquarters in Newport Beach, California. “There is a potential catastrophe if the U.S. government continues to focus on billions of dollars.”

    Gross manages the $132 billion Total Return Fund, the world’s biggest bond fund. The fund gained 4.8 percent last year and has outperformed 99 percent of its peers over the past five years, according to data compiled by Bloomberg. The average government and corporate bond fund lost 8 percent in 2008, Bloomberg data show.

    Pimco is a unit of Munich-based Allianz SE, Europe’s largest insurer.
  2. We need to spend in order to avoid a "mini depression"?? WTF does he think we're in now?
  3. What was very interesting were the comments made about not participating in the future Treasury Auctions by Pimco.... He mentions that he would seek other debt ....

    The point being is that the US Treasury needs several $Trillion....

    If Pimco is not going to participate....

    Who is ?
  4. Thread title should be:

    US Must Spend To Pull My Balls Out Of The Fire, Gross Says
  5. wave


    They can throw all the dimes they want to the public, ain't gonna work. The public woke up and is now picking up those dimes and saving them. No more silly spending on useless "stuff." Less is more and more is less. Get used to it. What will they do with all that empty mall space and all those overbuilt self-storage buildings?
  6. Haha!
  7. wave


  8. Actually, Bloomberg left out the 'trillionS' in its title.

    I wonder how many 'TrillionS' Mr. Gross would advise we burn?

    Would 4 trillion do the trick so that Gross can make a killing shorting long bonds, and create the inflation fever he's depending on?

    By the way, please rate this thread 5 stars if you think stock_trd3r is too young to be allowed on ET. Thanks.
  9. Exactly! And the situation is worse than it seems because the "lost" consumer demand will never return because it was created by people suck money from home equity and spending it. It's not that demand for cars is too low right now, its that demand for cars was too high a few years back.

    My estimates, based on how much of the last few years of GDP was illusory, are that about 3-6% of the U.S. economy needs to be (and will be) scrapped including excess homes, malls, storage buildings, etc.
  10. wave


    My wife arrived in this country 10 years ago from Europe.
    Within one year of living here, she said to me, "this US
    economy is a false economy built on money people don't really have." A concept she could not come to grasp.

    Poof, here we are 10 years later. She was right.
    #10     Feb 5, 2009