William H. Gross, Buy Cheap Bonds with Safe Spread, PIMCO, 2011

Rating: 4/5 Link

• Rather than outright default, many countries attempt rather successfully to keep nominal interest rates lower than would otherwise prevail.
• Over the long term, this “financial repression” results in a transfer of wealth from savers to borrowers.
• Investors shouldn’t give their money away, and at the moment, the duration component of a bond portfolio comes close to doing just that – because it doesn’t yield enough relative to inflation.

James Pach, Fixing Japan’s Fiscal Mess, The Diplomat, 2011

Rating: 4/5 Link

• Massively indebted, Japan needs new funds to pay for recovery efforts and kick-start its economy. It's time to be innovative.

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.

Robert J. Shiller, Needed: A Clearer Crystal Ball, The New York Times, 2011

Rating: 4/5 Link

• Making Financial Crises Predictable.

William H. Gross, Skunked, PIMCO, 2011

Rating: 4/5 Link

• Medicare, Medicaid and Social Security now account for 44% of total federal spending and are steadily rising.
• Previous Congresses (and Administrations) have relied on the assumption that we can grow our way out of this onerous debt burden.
• Unless entitlements are substantially reformed, the U.S. will likely default on its debt; not in conventional ways, but via inflation, currency devaluation and low to negative real interest rates.

William H. Gross, Two-Bits, Four-Bits, Six-Bits, a Dollar, PIMCO, 2011

Rating: 4/5 Link

• A successful handoff from public to private credit creation has yet to be accomplished, and it is that handoff that ultimately will determine the outlook for real growth and stability.
• Because quantitative easing has affected all risk spreads, the withdrawal of nearly $1.5 trillion in annualized check writing may have dramatic consequences.
• Who will buy Treasuries when the Fed doesn’t? The question really is at what yield, and what are the price repercussions if the adjustments are significant.

James Fallows & Eamonn Fingleton, The Myth of Japan's 'Lost Decades', The Atlantic, 2011

Rating: 4/5 Link

• The country's economy is stronger than it was in the '80s. Why Tokyo doesn't want the world to believe that.

Warren Buffett, 2010 Shareholder Letter, Berkshire Hathaway Inc., 2011

Rating: 4/5 Link

• To the Shareholders of Berkshire Hathaway Inc.

Tim Harford, What we can learn from a nuclear reactor, Financial Times, 2011

Rating: 4/5 Link

• The connection between banks and nuclear reactors is not obvious to most bankers, nor banking regulators. But to the men and women who study industrial accidents such as Three Mile Island, Deepwater Horizon, Bhopal or the Challenger shuttle - engineers, psychologists and even sociologists - the connection is obvious.

Michael Lewis, When Irish Eyes Are Crying, Vanity Fair, 2011

Rating: 4/5 Link 

• First Iceland. Then Greece. Now Ireland, which headed for bankruptcy with its own mysterious logic. In 2000, suddenly among the richest people in Europe, the Irish decided to buy their country - from one another. After which their banks and government really screwed them. So where’s the rage?

William H. Gross, Devil’s Bargain, PIMCO, 2011

Rating: 4/5 Link 

• Money has become the economic and political wedge for profound changes in American society.
• Perhaps the most deceptive policy tool to lessen debt loads is the “negative” or exceedingly low real interest rate that central banks impose on savers and debt holders.
• Old-fashioned gilts and Treasury bonds may need to be “exorcised” from model portfolios and replaced with more attractive alternatives both from a risk and a reward standpoint.

Paul Krugman, Can Europe Be Saved?, The New York Times Magazine, 2011

Rating: 4/5 Link

• The Road to Economic Crisis Is Paved With Euros.
• There's something peculiarly apt about the fact that the current European crisis began in Greece. For Europe’s woes have all the aspects of a classical Greek tragedy, in which a man of noble character is undone by the fatal flaw of hubris.

William H. Gross, Off With Our Heads!, PIMCO, 2011

Rating: 4/5 Link

• All investors should fear the consequences of mindless U.S. deficit spending.

Graham Bowley, The New Speed of Money, Reshaping Markets, The New York Times, 2010

Rating: 4/5 Link1 Link2 Link3

• The engine of Wall Street has shifted from the stock exchange floor to data centers in New Jersey, where computer-driven trading now accounts for 56 percent of all trading activity. While this Tron landscape is dominated by the titans of Wall Street, it affects nearly everyone who owns shares of stock or mutual funds, or who has a stake in a pension fund or works for a public company. For better or for worse, part of your wealth, your livelihood, is throbbing through these wires.

John Norstad, Investing in Total Markets, j.norstad, 2002

Rating: 4/5 Link

• Financial academics and other experts often recommend that investors should use index mutual funds to invest in entire markets. This advice is common with both stocks and bonds and with both domestic and international investing. Why do we so often hear this advice? When is it appropriate for an individual investor to not follow it or to use it as a starting point but deviate from it?

William H. Gross, Investment Outlook: Allentown, PIMCO, 2010

Rating: 4/5 Link

• Unless developed economies learn to compete the old-fashioned way - by making more goods and making them better - the smart money will continue to move offshore to Asia, Brazil and their developing economy counterparts, both in asset and in currency space.

John Cassidy, What Good Is Wall Street?, The New Yorker, 2010

Rating: 4/5 Link

• Much of what investment bankers do is socially worthless.
  

J.L. Borkowitz and R.J. Horrocks, Allocating to Asia, IMCA, 2010

Rating: 4/5 Link

• With the growing prominence of Asian financial markets, we often are asked, "How much should I allocate to Asia?" Thoughts on how Asia fits within a globally diversified portfolio.

William H. Gross, Run Turkey, Run, PIMCO Investment Outlook, 2010

Rating: 4/5 Link

• The Fed’s announcement of a renewed commitment to Quantitative Easing has been well telegraphed and the market’s reaction is likely to be subdued.
• We are in a “liquidity trap,” where interest rates or trillions in asset purchases may not stimulate borrowing or lending because consumer demand is just not there.
• The Fed’s announcement will likely signify the end of a great 30-year bull market in bonds and the necessity for bond managers and, yes, equity managers to adjust to a new environment.

Demographic Dynamics: A Case Study for Equity Investors, Goldman Sachs, 2010

Rating: 4/5 Link

• Retiring Baby Boomers.
• The expanding global middle class.
• Generational waves after the Baby Boom.