The last few days have been hectic for PIMCO executives. As we already noted, expectations of outflows persist and today's open in CDS markets suggested major concerns among market participants that PIMCO redemptions would force selling through an illiquid market. Sure enough, Bloomberg reports that PIMCO's Total Return Fund ETF was behind the auction of more than $170m of Fannie Mae CMBS on Friday (and more BWICs were seen today). As one trader noted, "you're going to sell your most liquid stuff first." Additionally, PIMCO has seen fit to delete all Bill Gross' tweets... so here are the last six months for the record.
As Bloomberg reports, the PIMCO liquidations have begun...
Pimco Total Return ETF behind auction of more than $170m of Fannie Mae CMBS on Friday, according to person with knowledge of the matter, who asked not to be named because the seller wasn’t disclosed.
List included most of ETF’s largest holdings in sector, according to Empirasign and Bloomberg data
Dealers also circulating ~$77m Fannie CMBS BWIC today with bonds in sizes similar to at least most of $3.6b ETF’s other holdings of the DUS securities, the data show
“You’re going to sell your most liquid stuff first. You don’t want to be a forced seller of anything. I would think these lists are going to be absorbed pretty well,” Brean Capital strategist Scott Buchta said in telephone interview
Other auction lists containing bonds in similar sizes to Pimco ETF’s holdings include: ~$59m of agency CMOs on Friday, ~$62m of subprime-mortgage securities today, ~$25m of senior CMBS today
And then... PIMCO removed all of Bill Gross' tweets from the @PIMCO account...
Click image for large legible version of Bloomberg feed of the last 6 months of Bill Gross Tweets via @PIMCO
One wonders just what it is that PIMCO is so afraid of... are they about to take a 100% diametric market view to the 'Bond King' and need no evidence left of the entire company's top-down market thesis? Or is it just standard practice?