‘‘Woulda coulda shoulda,’’ he said. ‘‘Obviously I wish I’d shorted a bunch of shares but that’s the bane of the portfolio manager: never happy.”
It Never Rains in California
Bill Gross on liquidity :
While private equity and hedge funds have built-in “gates” to prevent an overnight exit, mutual funds and ETFs do not. That an ETF can satisfy redemption with underlying bonds or shares, only raises the nightmare possibility of a disillusioned and uninformed public throwing in the towel once again after they receive thousands of individual odd lot pieces under such circumstances. But even in milder “left tail scenarios” it is price that makes the difference to mutual fund and ETF holders alike, and when liquidity is scarce, prices usually go down not up, given a Minsky moment.
Bill Gross Thinks The End Is Near
Sorkin: I have to know: Why do you wear your tie like that?
Gross: I came down here to Orange County in ’71 from L.A., and Pimco had this brand-new, beautiful building, but they didn’t have a gym or showers. I was an exercise nut. At noon, I’d change in the bathroom and then run for about five miles. Since there wasn’t a shower, I’d towel off as best I could, but I’d be sweating and hot for an hour or two. So in the afternoon, I began to just not tie my tie. Then a year or two later, I said: “Well, what the hell, I guess I’m not tying it in the afternoon, I’ll just not tie it in the morning either.”
Delighted to hear Bill Gross’ point of view regarding art collecting. He and his wife seem more impressed by stamps, which they’re renowned collectors.
I’ve never been much of an art aficionado myself, having settled for framing some All American Rockwells neatly clipped from old Saturday Evening Post covers. There was a time though when a well-publicized Rockwell came to auction and Sue and I expressed some interest. Ever since, we’ve been on the art house’s mailing lists and I must admit, it’s fun to browse through the Picassos, Rothkos, and whatever else currently frenzies modern collectors. I’m no expert though, and if I begin to pretend that I am, Sue puts me in my place because she’s the artist in the family. She likes to paint replicas of some of the famous pieces, using an overhead projector to copy the outlines and then just sort of fill in the spaces. “Why spend $20 million?” she’d say – “I can paint that one for $75”, and I must admit that one fabulous Picasso with signature “Sue”, heads the fireplace mantle in our bedroom
Negative Rates and Financial Intermediation
Now that negative and in almost all cases low short term rates are expected to persist, long term bonds and similar duration assets do not offer the ability to pay claims 5, 10, 30 years into the future.