Bill Gross at Pimco
Bill Gross at Pimco, when he's on, he's on....
"On a broader perspective, the growing fascination with hedge funds and indeed the ability to lever almost any asset at minimal borrowing costs which was the heretofore province of strongly regulated banks, promises excessive speculation that inevitably will follow the financial metronome's pendulum towards greed then back to fear, producing a number of near certain bubble poppings in the process.
America's and, therefore increasingly, the world's economy is unstably founded on a base of cheap money used as leverage to support certain asset prices of dubious value. If and when the cost of those funds moves sharply higher for any reason - a dollar crisis, inflation, foreign central bank sales of Treasuries, increasing budget deficits, to name a few - then the flaws of a levered economy will be quickly exposed."
And Bill, lets not forget about the price of oil and the terrorists.
"On a broader perspective, the growing fascination with hedge funds and indeed the ability to lever almost any asset at minimal borrowing costs which was the heretofore province of strongly regulated banks, promises excessive speculation that inevitably will follow the financial metronome's pendulum towards greed then back to fear, producing a number of near certain bubble poppings in the process.
America's and, therefore increasingly, the world's economy is unstably founded on a base of cheap money used as leverage to support certain asset prices of dubious value. If and when the cost of those funds moves sharply higher for any reason - a dollar crisis, inflation, foreign central bank sales of Treasuries, increasing budget deficits, to name a few - then the flaws of a levered economy will be quickly exposed."
And Bill, lets not forget about the price of oil and the terrorists.
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