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Bond Guru Bill Gross Likes 5-Year Treasuries, Advises Staying Away from the 30-Year

January 04, 2013 | About:

Pimco's king of bonds was on Bloomberg this morning for an extended interview. His observations include:

- The jobs report today tells us the economy is doing "all right," but it faces a lot of structural headwinds.

- The positives in the U.S. economy are energy production and housing; the fiscal drag from the cliff deal will offset some of these positives.

- He is afraid of the 30-year Treasury because of the possibility of inflation out in the future; the five-year Treasury on the other hand is reasonable.

- He thinks it is possible that we hit 240bps on the 10-year Treasury only if the Fed abandons quantitative easing.

- In Europe he would be overweight Italian bonds and underweight German.

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