Bill Gross said:

  • It will take economies and financial markets decades to normalize after the debt crisis, keeping U.S. securities the safest bet for investors. This is an authentic debt crisis and can only be ultimately cured by default or printing more money to inflate it away. A debt crisis can’t be cured with more debt when national- and household-debt levels as a percentage of GDP or household income become imbalanced. The current burden of global debt is only being lightly alleviated via zero-bound interest rates.
  • Don’t underweight Uncle Sam in a debt crisis – safe haven money will find it in America’s deep and liquid, almost Aaa rated, bond and equity markets. The U.S. Treasury market is the cleanest “dirty shirts” for investors.
  • He favors debt of the U.K. and the U.S. as Germany is in a bond-market bubble because of its rising liabilities from Europe’s debt crisis. German bonds have little room to rise further, except in a scenario such as Germany leaving the euro.

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