The financial press has been full of stories in recent weeks about star Pimco bond fund manager Bill Gross’ stance on Treasurys.
First Gross dumped all the Treasurys from Pimco Total Return Fund, the world’s biggest bond fund, in February. Then the company revealed last week that he has taken a negative position on Treasurys – to the tune of 3 percent of the fund’s $236 billion in assets.
But Politico news service reports: “We hear that Pimco is back in the market buying Treasurys despite some protestations to the contrary.”
The story’s author, Ben White, wasn’t immediately available for comment. And a Google search didn’t show any other news organizations reporting that Gross is purchasing Treasurys.
|Bill Gross (Pimco photo)
It would be quite ironic if Gross bought Treasurys in the wake of Standard & Poor’s decision Monday to issue a negative warning on the U.S. government’s triple-A credit rating. Gross himself said in 2009 that the U.S. will one day lose its triple-A rating.
To be sure, the 10-year Treasury note yield has dropped 22 basis points in the last week, to 3.37 percent.
And some investors remain bullish. “The geopolitical concerns haven’t gone away, and we are seeing safety flows into Treasurys,” Russ Certo, co-head of bonds at Gleacher & Co., tells Bloomberg.
“As the dust clears, we are in the here and now of geopolitical concerns rather than the future of uncertainty of what may happen with ratings.”
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