March 10th, 2011 6:38 AM by Eric Fang
Here is the news: Bill Gross of PIMCO had liquidated all of his holdings in long term Treasury debt for his PIMCO’s flagship Total Return Fund. That fund had total assets of $237 billion as of Feb. 28. Holdings of Treasuries had been over half of the total as of June 2010, so this is a big shift. The thinking is that Gross believes thebond market will collapse when the Fed ends QE2 in June, and investors will have to absorb all of the new Treasury debt beingcreated without the Fed printing new money to cover it.
So that means Bill Gross believes the fixed interest rate will go up after June 30th.