William H. Gross, The Caine Mutiny (Part 2), PIMCO, 2011

Rating: 4/5 Link

• Low policy rates and the increasing negative real yields that they engender as inflation accelerates represent an immediate threat to investment portfolios.
• Bond prices don’t necessarily have to go down for savers to get skunked during a process of “debt liquidation.”
• PIMCO advocates a renewed vigilance, stressing bond market “safe spread” alternatives available globally, including developing/emerging market debt at higher yields denominated in non-dollar currencies.