Bill Gross Warns "All Markets Are Bubbly"

Tyler Durden's picture

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slaughterer's picture

Decoded: "Equity markets are bubbly, so buy bonds to make me and PIMCO clients rich." 

Gross has only two things on his agenda: doing yoga, and talking his book in his ladyboy voice.  

Groundhog Day's picture

Hey Bill,  Is the Bond Market Bubbly? of course not right.  Don't try to be an angel trying to point out the obvious.  Your in the same category as Bernanke, Dimon, Blankfein, etc.  All you fuckers have distorted everything.  What isn't a Bubble?

Cult_of_Reason's picture

Everything is a bubble, but the algos have been following JPY breakdown (programmed as lower JPY = higher SPX).

Looks like there is another major leg down for JPY.

Occident Mortal's picture

It's incredibly difficult to call the top and it's incredibly difficult to trade counter trend.

Also it's incredibly painful to be short and wrong for any period of time.

Therefore the best way to play the current market is by buying long dated out of money puts.

I think 12 month puts are likely to get juiced as the Feds hand will be forced to Taper. The budget deficit is much lower than it was 2 years ago. Spending has been flat and tax revenue has recovered. This means the Treasury is simply not generating enough Treasuries to feed the Fed and provide tier 1 collateral.

The Fed has to yield, and when it does the boat will rock.

ZH Snob's picture

bubbly sounds like a lot of fun!

new game's picture

such an evolved young lad...

swear a euro chosen royality.

Cursive's picture

Whatever the price is today, be happy (while I'm secretly selling), but be cautious 6 months from now (when it will be too late).

DavidC's picture

All I know is that what's happening at the moment is ridiculous.


nope-1004's picture

Agree. It's hyper liquidity in overdrive.  Hyper liquidity to save the financial sector and not bring about bankruptcies is causing all kinds of market distortions.  One thing is for certain:  King dollar is on its death bed.  The liquidity injections done by the Fed and other central banks have done more harm than good, perhaps by design, perhaps by ignorance, but the outcome is guaranteed.


fonzannoon's picture

I got my hair cut today. My barber is a smart russian dude. He is one of those guys everyone thinks is probably lucky to be middle class. But he is a millionaire. He runs a successful cash business and buys rental property all over. He owns the building he works in, which is in one of the wealthiest neighborhoods in the U.S. Anyway, he knows I own gold. He knows I guy it. As does he, and lots of it. Anyway last time I went there he told me someone had just came in trying to sell 10oz of gold. He said that has been happening more frequently. This morning he told me some local rich guy came to see him trying to unload 100 ounces of gold. He has also been approached by more people who are trying to sell real estate. He asked me wtf is going on. The only think that seems apparent is the economy is taking another big leg down and people are starting to barf up real assets en masse. 

This is what I mean by deflation if you are out there BOP, people are busting out again. The fed is going to have to up the ante to cover what is happening now.

nightshiftsucks's picture

 Thanks for the info,makes you stop and think.

dick cheneys ghost's picture

I cut my own hair........why pay 20 bucks for a bad hair cut when I can give myself a bad hair cut for free....

Im sure you remember this comment...


Black Swan 9's picture

Right on target observations, imho.. It pays to be attentive to the little everyday things happening all around us that won't be seen (or nuanced) on the evening news.

999.9's picture

Unfortunately nobody selling stocks so far...

max2205's picture

No shit Sherlock

greatbeard's picture

>> All markets are bubbly.

I don't know, from where I'm sitting the metals market doesn't look particularly bubbly.

Oh yeah, gold and silver, the red headded step child.  The one everybody likes to take out to woodshed.




I am Jobe's picture

Like many sheeples you should invest in APPS. The future lies in Apps and not GOLD and SILVER. Just ask the sheeples as you ask them to tell them what the dollar is worth or why the Dollar has at the top- FEDERAL RESERVE NOTE and watch them stare 

JustObserving's picture
All Markets Are Bubbly

Especially the bond market with US debt and unfunded liabilities per taxpayer exceeding $1,254,170 today, there is no chance that your 30 year bond principal will ever be paid back except in hyperinflated dollars

new game's picture

bubbles come out my ars pre shit dump-thanks bill...

new game's picture

just woke up from my bear slumber from nov 12 when 1900 was in vogue.

wow, bears do need to hibernate til rip van gold wakes up.

speakin of bears, well i do like there type.

first they hang in the woods

second they don't give a shit bout you

third they avoid human(ussually).

so, back too sleep.

see ya next spring...

jballz's picture



bonds are RED, pimco bitchez.


but you don't own them so don't sweat it.

tawse57's picture

What did he say about markets 12 months ago? Was he warning to be careful of red in 2013?????

ptoemmes's picture

Is he still thanking the FED?

Sufiy's picture

Shellbomb announcement from China about its new policy towards reserves and Yuan appreciation are still making its rounds under the mainstream media radar. Once they sink into the market the inevitable QE Taper will be questioned again, particularly when people will remember that markets can Go Down As Well. No Bears are left in the Equity markets and No Bulls are left in the Gold market - everything is set up for the big surprise as usual. What will trigger that surprise? Maybe the chart below with the NYSE Margin Debt can give us some clues. Please note that Margin Debt Amount normally peaks before the Stock Market. Any move towards Taper will raise Interest Rates and we can have the Top in Margin Debt very soon if not already.

WhiteNight123129's picture

Not true, some farming companies are trading barely above their cash and way below liquidation value in Russia, China, some other farming at 3 times EBIT. JOhn Deere trades under 10 times earnings, no one likes commodities those days. 

Bill gross is right financial assets are in a bubble but not real assets (Silver is down a lot from its peak).


Ironically we have too much of debt (finanical asset of someonelse) to GDP (circulation of goods and services, commodities, present goods).That gurantees that Finanical assets (DOW industrial) will shrink to GDP (present goods, commodities, silver, gold). EIther the financial assets will have bankruptcies or the price of everything will rise very quickly. Either way the ratio Finanical assets / GDP will be restored.




Derf Scratch's picture

Naz 4068, no bubble just new tech companies changing the way we do business, Cramer said

yogibear's picture

Wouldn't be surprised to see Naz of 6,000 or 7,000. With thi unlimited Fed money and pumping we'll see ever higher markets.


Colonel Klink's picture

Had to have misspelled his company name on the license application should have been PimPco.

You should shut your tweet hole Billy.

orangegeek's picture

fuck right off Gross

polo007's picture


With Beijing repressing domestic consumption and holding down the yuan's exchange rate to give it a competitive edge in world markets, foreign direct investment poured into China to take advantage of cheap labour, land and other inputs.

Exports duly exploded. China's resulting current account surplus, though now declining, contributed to a glut of global savings that depressed U.S. interest rates and helped fuel the fateful boom in sub-prime mortgages.

China's foreign exchange reserves today stand at an unfathomable $3.66 trillion.

Tens of millions of people have been lifted out of poverty by the rise of China and other poor countries plugged into global supply chains.

But outsourcing of production has hollowed out skilled jobs in advanced economies in what British financial analyst Tim Morgan, in his book ‘Life After Growth' calls "a self-inflicted disaster with few parallels in economic history".

Jen added: "If you are a labourer in the West, you have been hurt. It's very clear. If you are a capitalist in the West, you have benefited immensely."

Dominic Rossi, global chief investment officer for equities at Fidelity Worldwide Investment, noted that labour's share of U.S. non-financial output held steady at between 61 percent and 65 percent for half a century.

"Then, something happened. From 2000, it plummeted and currently rests at an all-time low of 57 percent," Rossi wrote in the Financial Times. Over the same period, median U.S. household incomes have fallen in real terms.

"Overall, labour is not participating in economic growth as it has done in the past," he said.

The flip side is that U.S. corporate profit margins stand at 12 percent of gross domestic product, a record high, yet net corporate investment is only 4 percent of GDP, Rossi noted.

The picture of corporations awash with cash but reluctant to invest is mirrored in Europe.


So what is to be done?

Against a background of high debt and depressed incomes and investment, former U.S. Treasury secretary Larry Summers posited at a recent IMF conference that real interest rates consistent with full employment could now be minus 2-3 percent.

"We may well need in the years ahead to think about how we manage an economy in which the zero nominal interest rate is a chronic and systemic inhibitor of economic activity, holding our economies back below their potential," Summers said.

He is not alone in worrying about the limits of monetary policy even as the risks of outright deflation grow.

Alan Blinder, a former Federal Reserve vice-chairman, expects inflation to be lower on average over the next half a century than in the past 50 years. As a result, central banks would keep hitting the zero lower bound (ZLB) on nominal interest rates.

"We have just experienced first-hand how difficult the ZLB can make it for a central bank to stimulate its economy out of a recession and, therefore, how large the potential social costs are," Blinder wrote in a recent essay.

Bill White, a former chief economist of the Bank for International Settlements, blamed central banks for wrongly analysing the strong disinflationary impulse imparted by the reintegration of previously isolated economies such as China into the world trading system.

"Globalisation constituted a significant, long-lasting and positive productivity shock that should have been met with tighter rather than easier monetary policy," White said in a speech to Omfif, a London think tank.

By leaning against what they saw as excessive disinflation, central banks have helped to create the imbalances now dogging the global economy and have postponed the adjustments needed to achieve sustainable, balanced growth, White argued.

"In short, ‘still more of the same' monetary policies since 2007 have left us, in my view, with old problems unresolved and some new ones added as well," he said.

yogibear's picture

Don't worry Billy boy, everything can get a great deal more bubbly with Yellen, Evens and Dudley. They have reasons to expand this bubble beyond the DOT COM levels.

DOGGONE's picture

Look at our blood alcohol concentration

buzzsaw99's picture

amazing how utterly below average bill is without insider info from the fed plus a raging bull market in bonds. my bet is that "markets" have at least 10% more to the upside with "jowls" yellen on deck. bill wouldn't know that though because he is out of the loop.

Bunga Bunga's picture

Bitcoin up 10,000%+ yoy, but Wall St missed the train. When these fuckers are loosing, they wanna pull the plug.

q99x2's picture

I wouldn't put any money with a guy that wastes his time typing meaningless words unless that guy be Q99X2

Number 156's picture

He's short baiting. I think January will be fine by way of the typical fake numbers and muppetry. march will be a bitch. just a feeling.

Wahooo's picture

Bill, I can't hear you over the noise of your portfolios screaming in cold blood this year. See you at S&P 2,500.

nemesis2012's picture

        Guess what ? China will not be stashing dollars anymore............wouldn't be funny if Yellen tapers insted of prints to save the dollar. Interesting hypothetical situation. Yellen will make Beranke look like Santa Claus.