PIMCO | Investment Outlook – Run Turkey, Run
Investment Outlook William H. Gross November 2010
Run Turkey, Run
â€¢The Fedâ€™s announcement of a renewed commitment to Quantitative Easing has been well telegraphed and the marketâ€™s reaction is likely to be subdued.
â€¢We are in a â€œliquidity trap,â€ where interest rates or trillions in asset purchases may not stimulate borrowing or lending because consumer demand is just not there.
â€¢The Fedâ€™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.