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Bill Gross: "Give Thanks To The Fed, But Not Your Wallet"

Tyler Durden's picture


Some holiday cheer from the one person who surely has the most reasons (over a trillion) to be thankful to Ben Bernanke for.


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Thu, 11/28/2013 - 12:12 | Link to Comment vmromk
vmromk's picture

Death to the MOTHERFUCKING CRIMINAL Federal Reserve.

Thu, 11/28/2013 - 12:28 | Link to Comment Cult_of_Reason
Cult_of_Reason's picture

Nasdaq is not a bubble. It's impossible. It's 13% below internet bubble peak.

Thu, 11/28/2013 - 12:34 | Link to Comment Big Slick
Big Slick's picture

So... I shouldn't give thanks to my wallet?  ZH is getting into a bad habit of posting confusing headlines.  Why take Bill Gross's crystal clear tweet and change the word order to make it confusing?  Interns running the show on Thanksgiving I guess.

Thu, 11/28/2013 - 13:07 | Link to Comment kaiserhoff
kaiserhoff's picture

Alas, there is no money in blogs, as in no money.  They have turned out to be a lousy advertising venue, unlike television which no one watches anymore, or slick magazines which no one has read for decades (Esquire, Playboy, New Yorker, Time, damn near all of them.)

I wish someone in the industry would explain this to us. The net looks like a place to make money.  It rarely is.

Thu, 11/28/2013 - 14:50 | Link to Comment NoDebt
NoDebt's picture

European Tylers running the shop today??

Thu, 11/28/2013 - 14:57 | Link to Comment Ghordius
Ghordius's picture

interesting linguistic theory, here.

"Give Thanks To The Fed, But Not Your Wallet"

sounds perfectly correct and straightforward to me. it's not as if Tyler wrote "Give thanks to the FED, but not to your wallet"

but I'm still learning English, so perhaps I'm mistaken

Fri, 11/29/2013 - 00:39 | Link to Comment Torgo
Torgo's picture

Agreed. It's sloppy writing and I expect better from ZH. It should have been written Give Thanks (But Not Your Wallet) To The Fed.

Just as it is a basic and useful skill in economics to see what is unseen, it is a basic skill of everyday life to try to perceive as others perceive.

Thu, 11/28/2013 - 12:36 | Link to Comment max2205
max2205's picture

13% is chump change before this is done....might break the ath by end of dec......this will be the short of a lifetime

Thu, 11/28/2013 - 12:42 | Link to Comment Cult_of_Reason
Cult_of_Reason's picture

The politburo will be forced to announce QE tapering in December. Almost nobody -- not bulls or bears --expects tapering in December.

Thu, 11/28/2013 - 13:54 | Link to Comment Son of Loki
Son of Loki's picture

The Housing Bubble is deflatiing slowly right now. If they taper, watch it "POP!"


Thu, 11/28/2013 - 12:37 | Link to Comment AldousHuxley
AldousHuxley's picture

BIll Gross: "Stop buying S&P500 subsidized by Fed, buy my bonds instead"


Bill Gross always complaining when bonds suck at it because he doesn't run an equity hedge fund but a bond desk.


It it not a bubble when it is just inflation inflating EVERYTHING.

Thu, 11/28/2013 - 13:28 | Link to Comment pomlad5
pomlad5's picture

Bill is insider

Thu, 11/28/2013 - 15:54 | Link to Comment AldousHuxley
AldousHuxley's picture

bought inside info from KAshKAri, but that was long time ago. Lost out on Geithner's inside info. Need to wait to recruit Bernanke's retirement.

Thu, 11/28/2013 - 12:37 | Link to Comment moneybots
moneybots's picture

"Nasdaq is not a bubble. It's impossible. It's 13% below internet bubble peak."


Of coarse it is a bubble.  Because Greenspan says it isn't.

Thu, 11/28/2013 - 13:18 | Link to Comment Oldwood
Oldwood's picture

Evidently a bubble is only officially one after it has popped. All indications prior to such an event are simply anecdotal and meaningless because there is no absolute gaurantee that history will repeat itself, and rhymes don't count.

Thu, 11/28/2013 - 18:12 | Link to Comment Jannn
Thu, 11/28/2013 - 12:15 | Link to Comment max2205
max2205's picture

De risk till you are blue in the face....into what?

Thu, 11/28/2013 - 12:18 | Link to Comment fonzannoon
fonzannoon's picture

Bonds of course, and he happens to know just the right place to buy em!

Thu, 11/28/2013 - 12:27 | Link to Comment Groundhog Day
Groundhog Day's picture

De-risking from bonds is what he is talking about.  When the Fed loses control and rates rise, Gross will be just another chump who got in to the business at the right time and had the wind to his back all the time

Thu, 11/28/2013 - 12:54 | Link to Comment saveandsound
saveandsound's picture

De-risking from bonds?

That might be the right move, but how can a Pimco-Manager seriously say that? He can't go out of bonds, because his fonds are bound by their statutes. Gross can't step out of bonds.

So, either he is saying the opposite of what he believes in or he tells the public what would ruin his clients.

Or he suggests to de-risk from all other assets.

Now, who helps me out with a decent explanation of this cryptic tweet?

Thu, 11/28/2013 - 18:41 | Link to Comment Homo Erectus
Homo Erectus's picture

The way I interpret it is do de-risk from everything risky, from ridiculously overvalued bonds to stupidly expensive stocks.

While he is forced to hold bonds he can lower interest-rate risk by reducing the duration of his portfolio. 

Fri, 11/29/2013 - 16:17 | Link to Comment saveandsound
saveandsound's picture

Ok, that makes sense.

And leads pretty fast to the conclusion that the FED has to buy even more long-term bonds in order to suppress long-term interest-rates.

"What happens when my concerns are completly unfounded? Nothing. But what happens when my concerns are justified and ignored? Nothing good."

There is no exit strategy.

Thu, 11/28/2013 - 12:30 | Link to Comment CrashisOptimistic
CrashisOptimistic's picture

There are alternatives.  They just are not available to fat slobs who want to click and buy.  They require getting up from the computer and going to see people and buying from them.

And no, that doesn't mean gold.

Thu, 11/28/2013 - 12:16 | Link to Comment I am Jobe
I am Jobe's picture

Fuck the cunt YELLEN

Fuck you Bendonkey, Greeshit , Lloyd,Jamie, and many more

Thu, 11/28/2013 - 12:16 | Link to Comment SaulRosenberg
SaulRosenberg's picture

Hey wait...the title of this article doesn't match Gross' tweet! Zerohedge is a phony! A big fat phony!

Thu, 11/28/2013 - 12:23 | Link to Comment ThisIsBob
ThisIsBob's picture

Yeah, Yeah, Yeah, Bill.  Call the top.  Tell me when, what, and how much you short.  Be right behind 'ya.

Thu, 11/28/2013 - 12:32 | Link to Comment wisehiney
wisehiney's picture

Contrary to gross = MERRY CHRISTMAS!

Thu, 11/28/2013 - 13:24 | Link to Comment Oldwood
Oldwood's picture

I called the top three years ago. I'm out and don't give a flying fuck what it does. It just breaks my heart that I can't profit from participating in bringing about the end of the world.

Thu, 11/28/2013 - 12:40 | Link to Comment CrashisOptimistic
CrashisOptimistic's picture

Do yourselves a favor.  Take an hour and get educated on how much money is on deposit at the Fed from banks as excess reserves.  Look at the eye opening number.

Then compare that number to total QE since 2009. 

Thu, 11/28/2013 - 12:59 | Link to Comment Tyler Durden
Thu, 11/28/2013 - 13:12 | Link to Comment kaiserhoff
kaiserhoff's picture

Thanks, I missed that.  I'm sure many others did.

Really explains why lending standards have gone to hell, again.

Thu, 11/28/2013 - 13:31 | Link to Comment CrashisOptimistic
CrashisOptimistic's picture

Actually, Tyler, that's legitimate stuff, but not my point.  I was noting that the interest paid (0.25%) had been judged by banks as a (because it is guaranteed) superior place to keep that money than as a loan at 6% to just about anyone, because that would not be guaranteed.

Thus, QE never becomes "stimulus".  The banks won't lend it out.  Too dangerous.

I guess your point was they rolled the dice for more than 0.25%, still without lending it out.

Thu, 11/28/2013 - 14:23 | Link to Comment chindit13
chindit13's picture

Yes.  Interest on excess reserves is paying $6.8 billion per year to the banks, and requires a sum total of zero additional staff/facilities/systems.  Infinite ROI, since there is no I.  Zero credit risk, plus no need to worry about the danger of locking in a long term asset at 4% and funding it with short term money that quite often (historically) has cost 5% plus.  The opportunities to hedge and match book do not exist, because there is no other side to the trade one can use to lay off the risk.  Thus, JPM lets its cash cushion run up to $430 billion, dipping into it only when they need to pay fines or let some "cash management" group go wild in CDX IG9.  Even with the whale trade gone bad, the risk-reward for "customer facilitation" (formerly known as proprietary trading) is better than trying to squeeze a hundred fifty pips from a potential deadbeat's 30-year fixed, especially when compensation is so heavily skewed toward taking on trading (not loan) risk.

Since Nov 2009 (initiation of QE), the total workforce is essentially unchanged, and total system credit is identical at $7.3 trillon.  Bank system assets have risen by (QE minus defaults), but that rise has not been in new system credit.  The mix of credit has shifted slightly, with more car loans and student loans, and less mortgage debt, but the total amount is flat over the whole run of QE.  Pointless, except for the equity market.

I keep thinking back to the Yellen confirmation hearing when she was being questioned by Sen Johanns.  "I think you'd agree with me, though you might not want to say so in a public hearing", that everything tumbles if the Fed cuts off the sugar high.  They only pretend in public.

Thu, 11/28/2013 - 12:42 | Link to Comment moneybots
moneybots's picture

Give thanks to the FED for keeping the economy suppressed for the last four years and counting.  Have a merry wealth effect NOT Christmas too, thanks to the FED.

Thu, 11/28/2013 - 12:45 | Link to Comment ChaosEquilibrium
ChaosEquilibrium's picture

There are NO "investors"..............only TRADERS!


Retail will NEVER be able or allowed to hit the "sell" button!!!


Anyone under 2.5 Million Assets and NO market execution access.....GET OUT...get in cash/currency liquid....let the BIG BOYS take the PAIN!


Be smart money!

Thu, 11/28/2013 - 12:54 | Link to Comment ptoemmes
ptoemmes's picture

Uhh, no thanks.  I'll pass.

Thu, 11/28/2013 - 13:09 | Link to Comment Yen Cross
Yen Cross's picture

     Here comes the perfect exit strategy for the Fed. The markets take a shit and everyone pole vaults over into bonds, thereby keeping rates low and allowing the Fed. to dial back POMO.

    The Fed. can also blame the shitstorm on .gov or China or whoever starts the cascade event, and exhonerate themselves. (when in reality it was the Fed. fuckheads that caused the meltdown with their bubble blowing)

Thu, 11/28/2013 - 15:11 | Link to Comment RealityCheque
RealityCheque's picture

Thank Thanksgiving. Most American ZH'ers seem to be drunker and more belligerent than usual!

Thu, 11/28/2013 - 15:25 | Link to Comment jim249
jim249's picture

"Begin to de-risk if you haven’t already"

Stocks? Bonds? Dollars? PM's?  ???????????????????????????

Thu, 11/28/2013 - 17:34 | Link to Comment medium giraffe
medium giraffe's picture

Iodine Tablets? Fallout Shelters? Sub-Etha Signaling Device? !!!!!!!!!!!!

Thu, 11/28/2013 - 22:53 | Link to Comment deus x machina
deus x machina's picture

no sir, he is bound by the objective of the fund.  even if he knew that bonds were going to blow up he still couldn't sell the portfolio to all cash, for example. he may reduce duration some what but most likely not enough to have that much effect on rising bond yields. 

Thu, 11/28/2013 - 22:56 | Link to Comment MFLTucson
MFLTucson's picture

Heard Enron and Worldcom were going to be added to the S&P again to find some value stocks.  lol!  The whole sytem is a fruad!

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