Bill Gross Slams "Clueless Fed" Over 1.2% Growth In 12 Months

Tyler Durden's picture

As we pointed out earlier, today's GDP revision meant that real US GDP has grown only 1.2% in the past 12 months, rising at the lowest annual rate since 2010. And, it appears, Bill Gross also noticed that the US economy is barely growing, leading to the following violent outburst against the Fed, whom he blames for the lethargic growth.


Gross is, of course, right. However, what Gross fails to note is that the Fed is not only clueless, it is also trapped.

As we explained in June, "A 1% Increase In Rates Would Result In Up To $2.4 Trillion Of Losses", and that is only within the bond space. Equity losses would be even greater. And since the Fed's only mandate is to boost the wealth effect, the last thing the Fed can afford is to push yields higher.

Your move, "clueless" Janet.

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101 years and counting's picture

bring on NIRP!  i want my TLT to go to $200!!!!

knukles's picture

I had a dream.  A very disturbing dream.
I dreamt that all of the world's central bankers were trying to win a self-fellating contest.

eatthebanksters's picture

Well, Yellen lost that before it started for very obvious reasons...

NoVa's picture

could happen -

also consider SPXU


Good luck -

Cryoprase the Troll's picture

I've thought for a long time that it was bad to own government bonds because the yield was so poor. That part was right, but it wasn't the whole story... What I didn't count on was that they'd probably never be able to normalise rates, so people smarter than me have made big money as future growth tanked. But when does it blow up? Or is Japan the template that everyone will follow, like it or not?

wisehiney's picture

Bill Grossly full of shit.

Rabbi Chaim Cohen's picture

Why do all these "mavens" want to further the fallacy that the Fed has any mandate to manage the economy?

trollster's picture
trollster (not verified) Rabbi Chaim Cohen Jul 29, 2016 9:34 AM

Because that's what they read in textbooks.

TradingIsLifeBrah's picture
TradingIsLifeBrah (not verified) Jul 29, 2016 9:03 AM

Interest rates are used as a proxy for long term growth in financial models which means that everyone is driving their investment based on these low rates.  By circular reasoning alone the economy will be slowly pulled closer and closer to these rates as people forgo growth investment because they see no growth in the future.  We should be amazed that the economy still managed to grow at 1.2%, although we all know these numbers are false and the real numbers are much more likley to be deeply negative.

White Mountains's picture

Keep hating the innovators and risk takers, the backbone of our economy the small bussinesses created by people with big dreams that hire the bulk of Americans and give them the American Dream.  Keep rewarding parasites who suck off the hard work and risk small businesses take.  This is what you get.  Venezula calling...

Laughing my ass off, America is getting exactly what it wants through its choices.....reform or die.  It is that simple.

ParkAveFlasher's picture

Nothing like a good regulatory yoking to grind the whole thing to a halt.  But what the statists don't realize is that they themselves are collapsing, it is a hot potato forever stuck to their own hands.  Talent and wisdom do not collapse, they survive and salvage, and thrive.

SoDamnMad's picture

And Obo watched the Hope and Change as we roared ahead these last 8 years (NOT) with Hitlary ready to continue the Wall Street enrichment.

I sure hope that Paraguay hide-away can stay hidden from our prying eyes and pitchforks (and .338 Lupua Magnum)

buzzsaw99's picture

bill is clueless ever since he got cast out of the nexus

stant's picture

No NATO planes were shot down over the making of this GDP report

QE4MeASAP's picture

Just wait until Trump wins and the "non-political" FED says damn the torpedos and raises rates like you wouldn't believe. 

Phillyguy's picture

Trump is a billionaire, who has successfully gamed the system for years. Political rhetoric notwithstanding, it is unlikely the Donald is going to upset a financial system that has made him and his friends very wealthy.

Hal n back's picture

then Trump has to make sure the system does not collapse and the US become stronger. Thats the change he wants to avoid.


BTW--with all the dark talk from Trump and all the positive talk from Obummer and Hillary-just where is this economy headed?


Well, what difference does it make, if I have my situation taken care of.

They are all bums.

trollster's picture
trollster (not verified) Hal n back Jul 29, 2016 10:22 AM

The system will collapse, regardless of who wins. The system cannot last much longer and is cracking at the seams. The CBs' stimulus actions have a rapidly decelerating effect and we all know that we'll hit a wall at full speed. The CBs' actions only push the gas pedal harder and harder, and this will make the crash that much more catastrophic. They have no choice, because even if they stop now, the crash will already be colossal.

In short, we're doomed anyway, so let's enjoy the show for as long as it lasts.

geno-econ's picture

Perhaps, but Donald wants the system to survive and is more Nationalistic then Globalist.  Therefore he will chart new courses in military spending, failed foreign intervention, infrastructure investment, banker abuse, Fed failed debt economic policy which belongs with Executive Branch etc 

Phillyguy's picture

Hey Bill- the FED is anything but clueless. Their goal since the 2008 financial collapse has been to provide unlimited amounts of ultra-cheap fiat money to continue propping up (still) insolvent banks, and provide money for TBTF corporations for stock buybacks, to keep their share prices inflated. The FED has indeed accomplished this goal.

back to basics's picture


Shirley, give this man a cigar.

Secret Weapon's picture


The 1.2% number is pure bullshit. Factor in the true rate of inflation at 8% and take away government expenditures which are merely consumption and not production and you have a very negative GDP number.

saveUSsavers's picture


back to basics's picture

Glad to see some people are wide awake.

Firepower's picture

Clueless are those who don't see next quarter's Q1 re-re-re-revision downward to 0.1%

Chelsea-MALIA 2024!

ToSoft4Truth's picture

Clueless?  Are you making any payments right now - the FED has you right where they want you.  I'd say that is pretty smart. 



Spungo's picture

Bill is sure a positive guy. He assumes they're fucking everything up because they don't know any better. We're talking about people with doctorate degrees in economics. They know exactly what they are doing. They simply don't give a fuck.

mendigo's picture

That is the baffling part - you know these people are exremely bright and have access and resources to collect almost unlimited unrigged data and yet they do a crappy job...from our point of view (or lets say from the point of view of those less then incredibly weathy). On the other hand I suspect that GS and JPM are pretty f'ing satisfied to date as is Obama and Bezos and Gross - they just dont like that their profit growth is tailing off a bit and are positionning for the next bail-out. Depends on what you think is thier objective. You see, its a big club...

CarpetShag's picture

Was Bill's new company founded by James (J.) Anus ?

ToSoft4Truth's picture

U.S. National Debt is almost $20,000,000,000,000.  It's all owed to those 'dummies' at the FED.



yogibear's picture

Mrs Debtfire will just keep escalating debt and printing until something happens or blows up,simple.

Berspankme's picture

For a billionaire, Bill seems awful unhappy.

saveUSsavers's picture

The Mafia Fed are LIARS AND CRIMINALS deserving of nothing less than PRISON. ! Just look at "Owner's Equivilent Rent" inflation, for starters !

Berspankme's picture

Would love to see a plane charter full of central bankers crash

LoveTruth's picture

Fed is just a bunch of twisted in the minds and hearts and very ambitios to rule over us people - they are exactly like Obama and hilary. They lie to us over and over and over, and take as for fools. They are destroying America and their monetary policies designed to enrich their wall street patrons, and will continue to be destroying it if not stopped.

God save America!


Batman11's picture

2016 – “Richest 62 people as wealthy as half of world’s population”

Let’s face it people die all the time and there is war all over the place.

If we kill these 62 people off and redistribute their wealth demand will rise and the economy will be on its feet in no time.

It’s a small price to pay.

"Never was so much owed by so many to so few"

We can even put a little memorial up to them somewhere.

Batman11's picture

Oh dear, Bill Gross is one of them.

Sorry mate, but you were the one complaining.


SoDamnMad's picture

We could name a toilet facility at one of the new NATO bases in Europe after them.

ToSoft4Truth's picture

Those Dummies at the FED keep allowing the U.S. Government to write more and more debt in our names as they ride around in their limousines with armed security detail also riding in limousines. 

aliens is here's picture

Someone didn't get the memo about painting a rosey economy because just in his DNC speech Obama said how great the economy under him.

Atomizer's picture

Did you notice that no one fainted during Obama's DNC speech. 

Firepower's picture

no one fainted during Obama's DNC speech.

sorry, instead of "up" like last time, Cxris Matthews got a tingle goiing "down" his pantleg - but it was incontinence.

Atomizer's picture

But the influx of illegal immigration was suppose to stimulate the economy. 


LoveTruth's picture

Every single friend of mine (the business owners) in Los Angeles says they only make money to pay the rent and barely make any money on top to survive. 

All this Obama's recovery claim and that America is great is  TOTAL BS.

Just during Obama's admin America instigated civil wars in 3 countries and created millions of refugees. How great is that?


JailBanksters's picture

But what has the USA got to grow ?

What does the US make except for Weapons of War and Money created out of thin air.


JailBanksters's picture

TV's , Nope

Computers, Nope

Clothes, Nope

Footwear, Nope

Cars, Ah ha, Well assembled, most of the Components made in China


timehill's picture

Let's also not forget what it would do to the funding of the National Debt!