Gross Breaks On Through to Bernanke

We hate to interrupt the O’Neal death watch.

But it is that time of the month again. We envy Bill Gross. Not because he can stand on his head. Or because he works in sunny Newport Beach. Or because the investment community hangs on his every word.

No, it is because he only writes one piece a month. This month he invokes Irving Fisher, revisits the Weimar Republic and channels Jim Morrison.

Break on through to the other side and read it when you have time, but you can bet Gross is banking on more fed funds cuts. Lets cuts to the chase:

An increasingly recessionary looking U.S. economy will likely require 1% real short rates and 3½% Fed Funds in order to stabilize a potential growth contraction in lending not witnessed since the early 1970s or, to be honest, Roosevelt’s depressionary 1930s. We can only hope that Bernanke, Paulson, and their cohorts recognize the danger and that the music keeps playing with the lights still turned on.

Shadow Dancing
Pimco Letter

Clearly great minds think alike. I have a huge framed copy of that print, and stare at it all day long. If you like that famous shot, taken by legendary rock photographer Henry Diltz at the Hollywood Bowl in 1968, when Morrison was tripping during a poor, uneven performance, you can buy it at the Morrison Hotel Gallery.
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The content contained represents the opinions of 1440 Wall Street. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author.

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