Gross Says Diversify From Dollar as Deficits Surge
This has been an ongoing theme. I suggest we continue.
Here is the link to his Monthly letter.
June 3 (Bloomberg) — Bill Gross, founder of Pacific Investment Management Co., advised holders of U.S. dollars to diversify before central banks and sovereign wealth funds ultimately do the same amid concern about surging deficits.
The U.S.’s “fortune-producing capabilities seem to be declining, which might suggest that its relative standard of living is doing so as well,” Gross wrote in his June investment outlook posted today on the Newport Beach, California-based firm’s Web site. “If so, the implications are serious.”
Gross, manager of the world’s biggest bond fund, said on May 21 that the U.S. will “eventually” lose its AAA credit rating after Standard & Poor’s lowered its outlook on the U.K.’s AAA to “negative” from “stable” amid an escalating ratio of debt-to-gross domestic product. While U.S. marketable debt is at about 45 percent of GDP, annual deficits of 10 percent will push the amount to 100 percent within five years, a level that rating companies and markets view as a “point of no return,” he said.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aIn5e.W4zVRk
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Commodities/Futures, Fixed Income/Bonds, Politics, Strategy/Allocation | MacroMan | 
June 3, 2009 9:27 am
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