Odd Lots Bill Gross on the End of the Great Bond Bull Market
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Sep 13, 2023 
Bill Gross, known as the 'Bond King', shares his insights on the financial landscape after a historic bond bull market. He reflects on his illustrious career and the evolution of bond investing since the 1970s. Gross analyzes modern inflation challenges, drawing parallels to past crises. He discusses the impact of current interest rates and fiscal policies on investment strategies, particularly in sectors like oil and gas. The conversation touches on emotional trading strategies and highlights potential opportunities in the market, revealing what keeps him optimistic today.
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Early Bond Market Experience
- Bill Gross started his career in the 1970s, a stagflationary period with high interest rates.
- Bonds were almost self-hedging back then because a 30-year Treasury at 15% had a duration of 4.5-5 years.
Bear Market Survival
- Surviving a bond bear market requires focusing on relative performance to retain clients.
- Absolute performance becomes crucial in significant bear markets, as clients might leave regardless of relative returns.
Early Bond Trading
- In the early days of Bill Gross's career, bond trading lacked computers and clearinghouses, making it very different from today.
- At PIMCO, Bill Gross's tasks included manually clipping coupons from bonds stored in a vault, highlighting the lack of electronic systems.