Bill Gross Responds: "Sick Of [El-Erian] Undermining" Him

Tyler Durden's picture


Following last week's discovery that Mohamed El-Erian was "sick of cleaning up [Bill Gross's] shit" as tensions soared at PIMCO, the "bond king" has struck back blasting to Reuters that he's "so sick of Mohamed trying to undermine me," claiming El-Erian wrote the damaging WSJ article. Furthermore, the somewhat paranoid-sounding Gross indicated that he had been monitoring El-Erian's phone calls but when questioned by Reuters for evidence of El-Erian's undermining, Gross responded "you're on his side. Great, he's got you, too, wrapped around his charming right finger." As one analyst noted, "I've never seen Bill and Pimco scrutinized like this before... a couple of high-profile stumbles and mediocre showings, coupled with some outflows clearly has some investors on edge."


Via Reuters,

Gross told Reuters that he had "evidence" that El-Erian "wrote" a February 24 article in the Journal, which described the worsening relationship between the two men as Pimco's performance deteriorated last year, including a showdown in which they squared off against each other in front of more than a dozen colleagues at the firm's Newport Beach, California headquarters.

Gross, who oversaw more than $1.91 trillion in assets as of the end of last year and who is known on Wall Street as the 'Bond King', said in a phone call to Reuters last Friday: "I'm so sick of Mohamed trying to undermine me."

When asked if Reuters could see the evidence about El-Erian and the allegation he was involved in the article, Gross said: "You're on his side. Great, he's got you, too, wrapped around his charming right finger."

He said he knew that El-Erian, who had been widely seen as the heir apparent to Gross but is now due to leave in mid-March, had been in contact with Reuters as well as the Wall Street Journal.

Gross indicated he had been monitoring El-Erian's phone calls.


The Wall Street Journal quickly denied Gross' claims...

When asked about Gross's claim that El-Erian "wrote" the article, a spokeswoman for Dow Jones, the publisher of The Wall Street Journal, said: "This is an astoundingly incorrect claim about a thoroughly reported article that was in the best tradition of The Wall Street Journal."

As we noted previously, isn't it interesting that all these tensions occur as the Fed starts to taper and bonds , according to many strategists, end a 30 year bull market...

The latest signs of a rift between Gross and El-Erian, who once praised each other fulsomely, come as Gross is grappling with clients who are also turning their backs on the very asset class that has made him famous.

That is happening partly because the Federal Reserve continues to reduce its controversial bond buying that has provided stimulus to the U.S. and world economies.

Pimco saw its assets under management shrink by $80 billion in 2013 due to outflows and negative returns, according to Morningstar.


"I've never seen Bill and Pimco scrutinized like this before. This is the most attention I have seen on them," said Eric Jacobson, Morningstar senior analyst who has covered Pimco for nearly two decades. "A couple of high-profile stumbles and mediocre showings, coupled with some outflows - and with no identified successor for life after Bill - clearly has some investors on edge."


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Fri, 03/07/2014 - 12:23 | 4521442 Thought Processor
Thought Processor's picture


Turning into quite the cat fight.



Fri, 03/07/2014 - 12:24 | 4521451 camaro68ss
camaro68ss's picture

DOW is down 5 points, did a nuke just go off in the USA?

Fri, 03/07/2014 - 12:31 | 4521479 Divided States ...
Divided States of America's picture

When this was announced, the senile fucker went on CNBS and said that the 'divorce' with Mo was mutual....god everything that comes out of his trap cant be trusted.

Fri, 03/07/2014 - 12:34 | 4521490 Looney
Looney's picture

Wouldn’t it be fun to see Gross going full retar... errr... Charlie Sheen? ;-)

Looney (winning!)

Fri, 03/07/2014 - 12:36 | 4521506 john39
john39's picture

off topic, but of note, Tulving closes shop.


Fri, 03/07/2014 - 12:40 | 4521518 Arius
Arius's picture

i am getting sick too of that MUSLIM TERRORIST!!!!



Fri, 03/07/2014 - 12:44 | 4521528 Herd Redirectio...
Herd Redirection Committee's picture


Shit just got real!

Fri, 03/07/2014 - 13:07 | 4521631 Pure Evil
Pure Evil's picture

Bill Gross reminds me of what Eddie Munster would have looked like all grown up.

Fri, 03/07/2014 - 13:59 | 4521862 TruthInSunshine
TruthInSunshine's picture

Bill Gross can't wait for the day that "they" won't have Bill Gross to kick around anymore.

Fri, 03/07/2014 - 15:06 | 4522219 Keyser
Keyser's picture

That day may be sooner than he thinks. Bill Gross is doing himself no favors every time he opens his mouth on this topic. 

Fri, 03/07/2014 - 21:05 | 4523616 StychoKiller
StychoKiller's picture

Hmm, does lithium help with paranoia?

Fri, 03/07/2014 - 14:05 | 4521890 wilburpup
wilburpup's picture

Try Billy Mays

Fri, 03/07/2014 - 15:09 | 4522233 Dollarmedes
Dollarmedes's picture

Uh oh! Somebody's going to get de-friended on Facebook!

Fri, 03/07/2014 - 13:33 | 4521751 Colonel Klink
Colonel Klink's picture

Tulving is a lying cheating piece of shit.  As proven by his business dealings.

Fri, 03/07/2014 - 14:08 | 4521903 aVileRat
aVileRat's picture

Always knew he was a fraud, good riddance. Sucks for those out the phys.


Yeah, as I said last week. Sucks to be Bill Gross. He really is getting the shit kicked out of him this month, and it's starting to look a bit sad.



Fri, 03/07/2014 - 12:58 | 4521593 lasvegaspersona
lasvegaspersona's picture

Tulving has a lengthy history of late shipping which has worsened in the past couple of years. Rumored undelivered inventory of $500,000,000 and hundreds of BBB and CA consumer complaints apparently has done them in. Tulving went BQ in the 90s (I think that was the decade) but came back and did well for a while. I did business with them in 2010 and 2011 without problems. Others I know however were not so lucky and had to use the courts to get their money back. I have been warning friends and family for a year to go elsewhere.

Fri, 03/07/2014 - 13:47 | 4521809 e_goldstein
e_goldstein's picture

Not entirely off topic, just another example of a rat jumping ship.

Fri, 03/07/2014 - 14:03 | 4521881 Dr. Everett V. Scott
Dr. Everett V. Scott's picture




Fri, 03/07/2014 - 14:27 | 4522003 Max Cynical
Max Cynical's picture

More info here...

Fri, 03/07/2014 - 21:07 | 4523623 StychoKiller
StychoKiller's picture


Fri, 03/07/2014 - 12:58 | 4521542 Levadiakos
Levadiakos's picture

El-Arian is an poseur. He has never made any comment about the markets that wasn't covered with hedges and when on CNBC can't wait to divert the conversation to professional sports

Fri, 03/07/2014 - 13:54 | 4521838 NotApplicable
NotApplicable's picture


Fri, 03/07/2014 - 12:46 | 4521537 asteroids
asteroids's picture

The 30year bull market in bonds is done. El-smarty got out at the top and is leaving Gross to hold the bag.

Fri, 03/07/2014 - 13:34 | 4521755 ebworthen
ebworthen's picture

Gross's super-ego keeps getting tripped up by his id; his ego just wants to be seen on CNBC.

Fri, 03/07/2014 - 12:24 | 4521452 Flakmeister
Flakmeister's picture

Lover's quarrel...

I wonder if there is a 3rd fund manager involved...

Fri, 03/07/2014 - 12:35 | 4521473 Dr. Engali
Dr. Engali's picture

Maybe we should get Gross and El- Erian along with Ackman and Ichan for a tag team cage match.

Fri, 03/07/2014 - 12:42 | 4521521 Flakmeister
Flakmeister's picture

Last man standing would be more entertaining...

Fri, 03/07/2014 - 12:46 | 4521534 RSloane
RSloane's picture

No kidding Doc, they're worse than watching a Kardashian divorce.

Fri, 03/07/2014 - 12:50 | 4521559 Dr. Engali
Dr. Engali's picture

It's pretty darn pathetic. They sound like little school girls.

Fri, 03/07/2014 - 12:25 | 4521457 fonzannoon
fonzannoon's picture

Somebody caught this exchange between them at Pimco's headquarters right before El Erian left.

Fri, 03/07/2014 - 12:47 | 4521540 RSloane
RSloane's picture

Thanks for the lol Fonz.

Fri, 03/07/2014 - 12:42 | 4521523 skwid vacuous
skwid vacuous's picture

UFC #179 - only slapping, biting and hair pulling will be allowed

Fri, 03/07/2014 - 12:47 | 4521539 Herd Redirectio...
Herd Redirection Committee's picture

Don't forget trash talking and name-calling!

Fri, 03/07/2014 - 13:16 | 4521678 Divided States ...
Divided States of America's picture

Like i said last year...'Jew'-F-C 199


Headline fight: Carl "I can" Icahn vs Bill Ackman

goyim b1tch fight: Bill "Gross" Gross vs Big Mo

Celebrity fight: Dan Loeb vs George Clooney

Clown fight: BoZio (short for Zionist) the Clown vs Jim 'Bear Stearns' Cramer

Geezer fight: Alan Greedy Greenspan vs J-bitch Yellen

Knockout of the Night goes to Bozio for taking the trash out in 5 seconds.

Fri, 03/07/2014 - 14:13 | 4521929 skwid vacuous
skwid vacuous's picture

how about battle of the crypto-Lurches: John Kohn v. Mark Cuban

Fri, 03/07/2014 - 12:23 | 4521443 VD
VD's picture

The Bond Biyatch!


is only paper girls : kiss & make up....

Fri, 03/07/2014 - 12:35 | 4521499 Straw Dog
Straw Dog's picture

If indeed the 30 year bull market has ended or is ending as many claim, does that not mean that Pimco's $1.9 trillion bond portfolio will be decreasing in value from here on out - a problem of gargantuan proportions for Pimco and many other money managers, insurance companies, etc.

No wonder there is strife a Pimco, it is the end of an era where a rising market floats all boats. What's the corollary - "A falling market sinks all boats"

Fri, 03/07/2014 - 12:42 | 4521522 pitz
pitz's picture

When an entire firm's destiny is staked on one asset class, no wonder there's some strife when it is obvious that said asset class faces problems of such epic proportions. 

This is why the wealthy usually do not remain wealthy forever.  They get 'married' to their particular asset class or asset classes of choice, which periodically and cyclically become primed for destruction.  The fact that a bond fund manager, effectively a middleman, can become so large and so wealthy, epitomizes exactly what is wrong with the contemporary economy. 

That said, this whole spat is incredibly embarrassing for Gross.  He should probably go hide somewhere amidst his mountains of fiat instead of displaying such paranoid-schizophrenic tendencies in public. 

Fri, 03/07/2014 - 12:51 | 4521564 Herd Redirectio...
Herd Redirection Committee's picture

Well, yeah.  Look at the early oil fortunes.  Say you were a cooper, a barrel maker, there would be times where there isn't enough time in the day, for you to get your work done!  And then other times when there is no work at all, because the oil just wasn't worth selling (when there was a massive glut). 

Now thing of all the daytraders, house flippers, gov't employees...

Fri, 03/07/2014 - 12:50 | 4521560 VD
VD's picture

not boats that short said marketz...

Fri, 03/07/2014 - 12:23 | 4521448 mjorden
mjorden's picture

long live the king

Fri, 03/07/2014 - 12:25 | 4521458 alien-IQ
alien-IQ's picture

give these two over-privileged motherfuckers a couple of swords, lock them in a 10x10 windowless room and don't talk about them again until one of them comes out.

Fri, 03/07/2014 - 13:37 | 4521773 I Write Code
I Write Code's picture

What, windowless, no tv rights, no youtube?

Fri, 03/07/2014 - 12:25 | 4521460 Dr. Engali
Dr. Engali's picture

Bill was clearly kicked out of the club when he started sending his little tweets about the fed and shorting treasuries. Now the long knives of the oligarchs are going to finish him off.

Fri, 03/07/2014 - 12:27 | 4521469 alien-IQ
alien-IQ's picture

when they start eating their own, you know the game is almost over.

Fri, 03/07/2014 - 12:31 | 4521486 slightlyskeptical
slightlyskeptical's picture

My impression as well. Me thinks it would be wise to pull any funds from them.

Fri, 03/07/2014 - 12:35 | 4521502 Divided States ...
Divided States of America's picture

Bill went ballistic when he wasnt in the inner circle and wasnt included in the fed's important distribution this guy is turning to the dark side...didnt he just told everyone to load up on risk assets??

El Erian realizes this...he cant work with this senile two faced fucker....good for him to go somewhere else before PIMCO goes down like the Titanic.

Fri, 03/07/2014 - 12:43 | 4521524 Four chan
Four chan's picture

european risk assets. are those actually assets?


Fri, 03/07/2014 - 12:56 | 4521580 Herd Redirectio...
Herd Redirection Committee's picture

I have always been intrigued by the fact that in accounting,  all that separates an asset and an expense is... An accountant!  An honest one, preferably.

Say your company 'invests' $1m on junk bonds. 

Debit:  Asset (junk bond) $1,000,000

Credit: Cash $1,000,000

And what did Worldcom, Enron etc do?  They capitalized expenses! 

Fri, 03/07/2014 - 15:46 | 4522423 Four chan
Four chan's picture

good point

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