UK hooked on debt, PIMCO boss warns

homelessskilledworker

http://www.telegraph.co.uk/finance/economics/9582547/UK-hooked-on-debt-PIMCO-boss-warns.html



Britain is part of a debtor nation “ring of fire” where bondholders are at risk of being “burned to a crisp”, the head of the world's biggest bond house has warned.

Bill Gross, PIMCO’s founder and chief investment officer, compared the UK to a drug addict who is hooked on debt and struggling to kick the habit in his monthly investment outlook. His comments were part of a broader warning that the US would turn into Greece within a decade if the government did not find $1.6 trillion (£990bn) of savings “over the next five to 10 years”.

Generali

It's worth listening to your 2nd largest customer, especially when your largest customer is your own central bank!

Having said that, PIMCO didn't do so well last time they dumped Gilts so all is not yet lost.

CLAPTON

seems to be a man for all seasons
mind you, it probably explains our high gilt coupons and general high and rising interest rates.

Mr Gross, whose company manages $1.8 trillion across the world and whose head of European investment is Ed Balls’ younger brother Andrew, is famous for his florid warnings and influence over market sentiment, if not his consistency.

In January 2010, he helped tip the UK political argument in favour of Tory austerity by warning that gilts were “resting on a bed of nitroglycerine”. In what proved a costly decision, PIMCO sold down its holding just as gilt prices began a giddy rise. In September last year he shifted tack, suggesting that the Chancellor should consider “at a minimum fine-tuning and perhaps re-routing the plan”.

“The problem becomes if [austerity] is too quick and leads to an economic contraction, which it appears close to in the UK,” he said at the time. “An economy that doesn’t grow, ultimately can’t resolve its debt crisis.”

homelessskilledworker

Generali wrote: »

It's worth listening to your 2nd largest customer, especially when your largest customer is your own central bank!

Having said that, PIMCO didn't do so well last time they dumped Gilts so all is not yet lost.

And do they not have have Ed Balls brother working for them, Gulp!!