We once knew a professional safe cracker, a neighborhood kid. He was good. Enjoyed his work. And he did real well until one chilly, dark autumn night a petrol car pulled him over to the side of a lonely country road because half of a big safe was sticking out of the trunk of his battered old red Buick.
When the officer asked him how it got there, he said that he didn't know, that someone else must have put it there. Claimed he never noticed it before. "That's my story," he said, as the officer pressed him for more details. "I have no song and I'm sticking to it."
This too is a story about the "new normal" guy, the blackjack card counter, the kid from Butler Creek. The famous bond investor from Fashion Island. The new normal ain't so normal anymore. At least, that seems to be his story and from what we read he's sticking to it.
Bill Gross has recently come out and said that the "system itself is at risk" and that a "day of reckoning is coming". Ominous words indeed, but sadly, the truth.
Putting his money where his mouth is, Bill Gross is defying all of his instincts as a bond investor and is revamping his $1.3 billion "Janus Global Unconstrained" Bond Fund. He is moving his fund into a position to sell insurance and credit risk.
These actions are brought on by his deep fear that the market is going to break down in the future. He believes Central Banker stimulus has artificially propped up the markets and this illusion we live in is no longer going to last. The proof of this is in the fact that stimulus by Central Bankers is having less and less effect, even as more and more money is printed.
He also fears that the US government is heading down the path of Japan and envisions a day when the government buys up all the debt, eliminating and forgiving it. This of course would be wildly inflationary and be an admittance that the end is nigh on their own part, likely ending in an epic collapse of the Western monetary system.
The thing that troubles is not so much Gross' outlook. Sounds more than plausible to us. A rumor we recently heard is what's really bothering us, though we can't at this time vouchsafed for it. But we'll share it anyway: We've heard those central bankers, like that kid from the neighborhood, own an old, battered red Buick.
zerohedge.com/news/2016-05-26/bill-gross-goes-against-his-insticts-turns-bearish-bond-markets
The thing that troubles is not so much Gross' outlook. Sounds more than plausible to us. A rumor we recently heard is what's really bothering us, though we can't at this time vouchsafed for it. But we'll share it anyway: We've heard those central bankers, like that kid from the neighborhood, own an old, battered red Buick.
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