Investors Likely to Lose on Cash and Bonds. Those are “Investment Garbage”

Pimco co-founder, who was once a bond king, has equated them to an “investment garbage” that is similar to cash. US 10-year Treasury yield is 1.296%.

Gross says long-term yields on Treasuries are low, equating funds that buy them to an “investment garbage can.”
The investor says ten-year yields would likely rise to 2% in the next 12 months, from the current 1.3%, which will cause a loss of about 3% to investors.
Gross also feels that stocks can easily fall into the “trash” category if earnings fail estimates.
The Pimco co-founder says supply and demand dynamics are weighing against the Treasuries, saying that current yields have to go higher.
Gross has held bearish positions on bonds. In March, he said he was betting against Treasuries at the 1.25% rate.

Investors Likely to Lose on Cash and Bonds. Those are “Investment Garbage” – Pimco Co-Founder