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Posts Tagged ‘Pimco’

12 Warning Signs of U.S. Hyperinflation

March 29, 2011 Comments off

inflation

One of the most frequently asked questions we receive at the National Inflation Association (NIA) is what warning signs will there be when hyperinflation is imminent. In our opinion, the majority of the warning signs that hyperinflation is imminent are already here today, but most Americans are failing to properly recognize them. NIA believes that there is a serious risk of hyperinflation breaking out as soon as the second half of this calendar year and that hyperinflation is almost guaranteed to occur by the end of this decade.

In our estimation, the most likely time frame for a full-fledged outbreak of hyperinflation is between the years 2013 and 2015. Americans who wait until 2013 to prepare, will most likely see the majority of their purchasing power wiped out. It is essential that all Americans begin preparing for hyperinflation immediately.

Here are NIA’s top 12 warning signs that hyperinflation is about to occur: Read more…

Pimco Buying Emerging Market ‘Rising Stars’ as Inflation Looms

March 22, 2011 Comments off

www.businessweek.com

March 21 (Bloomberg) — Pacific Investment Management Co. says investors should buy company debt in Russia, Brazil and other emerging markets where rising wages and relatively low public and private debt will help borrowers weather accelerating inflation.

The manager of the world’s biggest bond fund is buying debt of “rising stars” linked to nations with expanding wealth because they will more easily be able to pass on higher materials costs, Mark Kiesel, Pimco’s global head of corporate bond portfolio management, wrote in a report today on the firm’s website. At the same time, he’s avoiding companies dependent on growth in Europe, the U.S. and Japan that will struggle amid stagnant wages and debt-laden governments and consumers.

“Companies which are tied most directly into the strong economic growth engine in the emerging markets should have the most pricing power and ability to either pass through rising costs or absorb them without a significant margin hit,” Kiesel wrote. Those more Read more…

Central Banks Dump Treasuries As Dollar’s Reserve Currency Status Fades

March 16, 2011 Comments off

forbes.com

By AGUSTINO FONTEVECCHIA
Official inflows vs total reserve accumulation – Nomura

Demand for US assets, especially Treasuries, has been waning since the beginning of 2011, with central banks around the world increasing reserve accumulation while dumping the greenback.  More signs that the dollar is dead as the world’s only reserve currency?

Nomura’s FX research and strategy team analyzed the latest numbers from the Treasury’s International Capital System.  “It looks like the trend of weak central bank demand for USD assets is persisting into 2011 (after a very weak Q4),” wrote Nomura’s global head of G10 FX strategy, Jens Nordvig in an email.  From November to January, central banks reduced their US dollar holdings by $9 billion; “given a fairly strong trend in global reserve accumulation Read more…

Japan catastrophe could make U.S. debt costlier

March 15, 2011 Comments off

reuters.com

The U.S. Treasury market could feel financial aftershocks from Japan’s tragic U.S. Treasury. Offloading some of the Asian giant’s $1 trillion of foreign reserves could raise cash to help rebuild after Friday’s disaster. Meanwhile, the Federal Reserve is due to end its Treasury bond-buying program in June. If Japan, the second-biggest foreign holder, starts selling that’s another support gone — with the potential to make borrowing more expensive for the U.S. government.

It’s too early to estimate the cost the Japanese government and private sectors will have to shoulder for reconstruction efforts. But bond investors can’t any longer take for granted that Japan will leave its ample reserves intact as it has, broadly speaking, for the past several years. For the government, cashing in could be more palatable than yet more borrowing. Japan’s debt already amounted to more than 200 percent of Read more…

US Treasurys Dumped, Pimco Sees Value In Emerging-Market Bonds

March 11, 2011 Comments off

wsj.com

NEW YORK (Dow Jones)–The valuations on U.S. Treasurys are not attractive in a historical context and Pacific Investment Management Co. is moving money toward emerging-market debt, said the fund’s founder Bill Gross in an interview on Thursday with CNBC.

Reports came out on Thursday that the bond-fund giant had dumped all of its holdings of U.S. government bonds. Gross said better valuations can be found elsewhere, where yields are not artificially boost by Federal Reserve purchasing.

“The overvaluation [in Treasurys] has been dependent on the purchasing power of the Fed,” said Gross, who does not believe there will be a third round of “quantitative easing.”

Pimco did not participate in Thursday’s 30-year auction nor Wednesday’s 10-year auction, Gross said, though both were considered well-received.

The fund still owns about Read more…