El-Erian To Gross "I'm Tired Of Cleaning Up Your Shit"

Tyler Durden's picture

Bill Gross, by his own admission, is a demanding boss; but as the WSJ reports, one day last June (amid the bond sell-off), things went a little turbo (leading to Mohamed El-Erian's recent resignation):

Gross: "I have a 41-year track record of investing excellence... What do you have?"


El-Erian: "I'm tired of cleaning up your shit."

While careful to deny that El-Erian's departure had anything to do with 'friction' although even Mr.Gross admits he can be difficult to work with,"sometimes people will say 'Gross is too challenging,' and maybe so. I would say if you think I'm challenging now, you should have seen me 20 years ago."

Funny what happens when a 30 year bull market for bonds starts to stall out..


Tension increased at Pacific Investment Management Co.'s headquarters here last summer. The bond market was under pressure, losses grew and clients pulled billions of dollars from the firm.

Last summer, bonds came under pressure because investors were worried the Federal Reserve would reduce its bond purchases. In June, investors withdrew $9.6 billion from Mr. Gross's fund. "Don't jump ship now," Mr. Gross wrote clients that month.


But more investors cashed out, adding to the stress. Disagreements between Mr. Gross and Mr. El-Erian became common over trading strategy, personnel decisions, new products and more, employees say.


Some of Mr. Gross's decisions struck some employees as unusual. Last summer, during a rough time in the market, Mr. Gross limited the firm's trading, restricting it mostly to sales aimed at raising cash to meet client withdrawals, according to three Pimco employees. Some employees complained to Mr. Gross and Mr. El-Erian that they couldn't buy inexpensive investments and that Mr. Gross didn't seem to trust their abilities. Mr. Gross didn't budge. He had restricted trading during rough patches before. These restrictions were longer, lasting for several weeks, according to the three employees.


A Pimco spokesman said the firm's investment committee told employees to limit "nonessential" trading—as it sometimes does during market stress—and that overall trading volume didn't decline during those weeks.

Bill Gross, who co-founded Pimco in 1971 and is largely responsible for building it into a behemoth overseeing almost $2 trillion in assets, struck some of his colleagues as testier than usual. He argued openly with Mohamed El-Erian, Pimco's chief executive—something employees say they rarely had seen.


"I have a 41-year track record of investing excellence," Mr. Gross told Mr. El-Erian, according to the two witnesses. "What do you have?"


"I'm tired of cleaning up your shit," Mr. El-Erian responded, referring to conduct by Mr. Gross that he felt was hurting Pimco, these two people recall.

In an earlier interview with The Wall Street Journal in January, Mr. Gross denied tension with Mr. El-Erian was a factor in his departure. "It had nothing to do with friction," he said, although he acknowledged he can be difficult to work with. "Sometimes people will say 'Gross is too challenging,' and maybe so. I would say if you think I'm challenging now, you should have seen me 20 years ago."

Interviews with nearly two dozen individuals close to both men and to the firm suggest more-important factors in the departure: a high-pressure work environment that turned less collegial over the past year, a deteriorating relationship between the two senior executives and certain decisions by Mr. Gross that confused some employees.

The environment is 'different'...

Most Pimco investment professionals arrive at the office around 4:30 a.m.—well before trading opens on Wall Street—and stay until 5 p.m. or later. The firm encourages internal competition, current and former employees say.


On the trading floor, Mr. Gross doesn't like employees speaking with him or making eye contact, especially in the morning, current and former employees say.


He prefers silence and at times reprimands those who break it, even if they're discussing investments, these people say.

But to the future...

Mr. Gross said in a recent interview that he would be stepping back from some investment duties, but others at the firm are skeptical he will give up any control.


"I'm ready to go for another 40 years!" Mr. Gross posted on Twitter TWTR -0.88% after Mr. El-Erian's departure.




Since the announcement, Mr. Gross has expressed disappointment and bewilderment over Mr. El-Erian's departure, telling colleagues that Mr. El-Erian was offered whatever he wanted to entice him to stay.


Earlier this month, the firm began removing Mr. El-Erian's pictures from Pimco's walls and placing copies of a book he wrote in boxes for storage. They also moved Mr. El-Erian's office to a building far from Pimco's trading floor.

Source: The Wall Street Journal

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
TeamDepends's picture

<Gross slaps El-Erian silly

<El-Erian slaps Gross silly

Thought Processor's picture

The money these guys make per year is just crazy.   Hundreds of millions.  They boys on the beach are some of the highest paid guys in the biz.

jcaz's picture

Soooo, Bill......   You made money in a one-way market for 30 years and you want a bone?  El-Erian called you on your shit and you peed yourself-  "Master of the Universe" indeed.....

zaphod's picture

"Some employees complained to Mr. Gross and Mr. El-Erian that they couldn't buy inexpensive investments and that Mr. Gross didn't seem to trust their abilities. Mr. Gross didn't budge."

Sounds to me that some bankers wanted to take risks and buy crap thinking it was cheap, but the more experienced trader Gross knew it was time to stay on the sidelines.

Staying on the sidelines doesn't make money for younger traders, but you can't lose money either, which is the whole point.

onewayticket2's picture

"Pride comes before the fall..."

Arius's picture

its simple amazing ... i thought that el erian guy was a smart dude, obviously not ... how could that fucker thinks of standing up to ole bill ... i guess all of these tv interviews are always prepared so to make someone look sharp

NoDebt's picture

Don't care who you are or what your experieince is.  When the easy wins stop coming, ain't nobody happy.

Arius's picture

you believe in "easy wins" and hard work and all that ... it is a fixed game my man ... it is a club and you (and i unfortunately or rather fortunately :) aint in it ...

Wahooo's picture

I don't get it. Did someone forget to tell Gross to buy stocks?

asteroids's picture

El-Erian got out at the "top". Interest rate are going up sometime this year.

redpill's picture

You could tell by his tweets that Gross started going truly bat shit crazy about a year ago.  He was always a little odd but he's off the deep end now.  Good luck Total Return holders!

Cacete de Ouro's picture

It's not healthy for two guys to share a twitter account. It was always going to lead to trouble. Especially since Gross kept changing the password.

SamAdams's picture

that ego is freakin' huge!  almost as big as "I'm richer than you, that's why"...

Mad Mohel's picture

Any man over the age 30 that tweets on a regular basis, usually owns a dildo, and it's not his wife's.

Arius's picture

bill gross isnt any man you stupido ... after you read his tweets, you check your fingers ... if you are smart enough to get it ... probably not ...

VD's picture

cleaning shit up after u a made man aint same as cleaning shit when u comin up........

Againstthelie's picture

What do they have from their money? Absolutely nothing. Their life quality is below any middle class worker.

If Gross wants to work another 40 years you know, that he cannot enjoy the simple things in life and the private life.They believe they are unreplaceable, but only two weeks after they left, nobody even cares if they are still alive.

Poor souls that never in their life (unlike when they were a child) will be able to feel the joy again, when going into the garden, listening to the music of the birds and harvesting the homegrown vegetables which will be cooked later. That's the beauty of financial independence, but these guys are just slaves of success, the simple things have lost their beauty for them and even if they would own the world, it wouldn't be enough. And they don't recognize it. They are like drug addicts. Addicted to success and MOAR MOAR MOAR!


The_Dude's picture

Exactly....and now that you mention it...where the hell is Hedgeless?

NotApplicable's picture

I always thought El-Erian seemed to be too smart to be partnered with Gross.

I guess he realized the same.

disabledvet's picture

not the first mashed ego to get slammed there.

and no...Pimco and Gross are not alone in this behavior...especially when it comes to bond trading outfits.

Here was one of the most notorious actually:

You went to work there and you earned it.
Ruthless...but still was able to survive 9/11.

Those who "made it" literally "survived" the company...and it has thrived since then actually.

Always hard to find a "boy wonder" in this world...fail to find one however and your firm can be deep sixed. "that rolodex can never be too deep" as they say.

TruthInSunshine's picture

VI p.s. - An article like this, in hugely read/distributed publication, highlighting I internal strife at the biggest bond behemoth on the planet...

...does bottom for bonds draw near, bitches?

DavrosoftheDaleks's picture

El-Erian's joining Doubeline, right?  Gundlach's leaving of TCW was Waaaaaaaaaaaaaaaaay more interesting than this story.  Unless El Erian also had dildos and coke in his desk too....

ShrNfr's picture

Salmon slaps them both silly.

nuclearsquid's picture

With all of these celebretized big wigs it always strikes me as if they were children playing with nuclear weapons.


1stepcloser's picture

As as wise man, once said to Mr. Hand..."You Dick"



Ignatius's picture

"...if you think I'm challenging now, you should have seen me 20 years ago."

I imagine Hitler saying the same thing in '65 if he'd made it to Brazil.

Cognitive Dissonance's picture

What makes you think he didn't make it to Brazil......or anywhere else for that matter. Some bones in a smoldering pit, a supposed 'suicide', handled by his personal guards?  :)

<And I suppose Osama Bin laden is also swimming with the fishes.>

Ignatius's picture

I wasn't gonna go there, CD!  You have more courage.

Kinskian's picture

I'll take Hitler's word...

After six years of war which, despite all setbacks, will one day go down in history as the most glorious and heroic manifestation of the struggle for existence of a nation, I cannot abandon the city which is the capital of this Reich. Since our forces are too meager to withstand the enemy's attack and since our resistance is being debased by creatures who are as blind as they are lacking in character, I wish to share my fate with that which millions of others have also taken upon themselves by remaining in this city. Further, I shall not fall into the hands of the enemy who requires a new spectacle, presented by the Jews, for the diversion of the hysterical masses.

Dr. Engali's picture

Bill you should have retired when you were on top, but like many worn out  'professionals' you stayed on too long and now you will be forever remembered for the folly at the end of your career. You do have this going for you... the way Becky Quick was defending you this morning,there may be a bath in your future. She seems to have a thing for decrepit old oligarchs.

jcaz's picture

Well, she works for them.....

TruthInSunshine's picture


At the cnBSc studios, all was genteel & kind, as pleasant banter was exchanged, and Mr. Bill Gross explained why he appointed the very astute Mohammad El-Erian to the highest active position at PIMPco...

...but behind the scenes...

"I'm tired of cleaning up your shit."


medium giraffe's picture

"Mr. Gross doesn't like employees speaking with him or making eye contact, especially in the morning, current and former employees say."

Another self important cunt.  Should we be surprised that he is incompetent too?   

NotApplicable's picture

I'm having difficulty wrapping my mind around the idea of a silent trading floor. Kind of hard to call it "41 years of investing excellence" when one refuses to communicate in an "Information Age" market.

Right place, meet right time.

TruthInSunshine's picture

Whisper rumor that Bill Gross has an executive assistant whose only job duty is to scrub, dry & apply Gold Bond powder to his testicles.

Excursionist's picture

Of all the points in the WSJ article, this one struck me as most noteworthy - it cuts to the core of the person. 

Unfortunately, clients don't give a shit whether Gross is a narcisistic borderline sociopath as long as he makes risk-adjusted money.

dellievan's picture



  Surprised that he is incontinent too  ?

Kirk2NCC1701's picture

Watching a new episode of Dallas is even more tawdry and certainly more entertaining.  Sad to say.

Glass Seagull's picture





Jumbotron's picture

Oh yeah.....I drive an AMC Pacer.

And on the weekends I drive a Gremlin.

Iam Yue2's picture

Would you want to work with a man who had made one of the worst investment calls of the last one hundred years;

"26 Jan 2010 - "the U.K. is a must to avoid. Its Gilts are resting on a bed of nitroglycerine. High debt with the potential to devalue its currency present high risks for bond investors. In addition, its interest rates are already artificially influenced by accounting standards that at one point last year produced long-term real interest rates of 1/2 % and lower."

LawsofPhysics's picture

LOL, here, if you don't mind, could you hold this bag for me?


What's the problem?  I thought PIMPCO was holding all kinds of grade AAA+ collateral.

centerline's picture

Oh shit, the "C" word (collateral).  Too bad there are at least 100 hands on every bit of collateral known to mankind (plus some).  lol.

Buck Johnson's picture

Since PIMCO is the biggest bond buyer I bet anything many of his decisions that Gross did wasn't for the company but for the US govt..  Essentially to save the bond market and save the US and not his company and that is why El-Erian didn't like his decisions.  And to be honest with you he probably knew but probably thought that Gross would make a decision to get out of the pocket of the govt. and worry about the company.

akak's picture

I find the very idea of a catfight between Mohammed "Freddie Mercury 2.0" El-Erian and Bill "Tinkerbell wants her voice back" Gross enormously hilarious.

williambanzai7's picture

Isn't Gross the guy who yelled: The nerds saw me naked?