Bill Gross: Fed to Keep Rates at Zero Through 2010
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December 8th, 2009 by Prieur du Plessis, Investment Postcards from Cape Town
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The Federal Reserve will keep interest rates near zero in 2010, but longer-term rates will gradually tick higher because of supply and demand, Bill Gross, founder of Pimco, told CNBC Monday.
“We have a lot of supply and perhaps not as much demand to satisfy that supply, and that may actually reinforce the move towards higher rates on the longer end of the yield curve,” he said.
Gross said that stocks will perform “alright” in the long term, but investors should not expect double-digit returns as the Fed pulls excess liquidity out of the markets.
Source: CNBC, December 7, 2009.
Dr. Prieur du Plessis is an investment professional with 26 years' experience in investment research and portfolio management. More than 1,200 of his articles on investment-related topics have been published in various regular newspaper, journal and Internet columns, including his blog, Investment Postcards from Cape Town. He has also published a book, Financial Basics: Investment. Prieur is Chairman and principal shareholder of South African-based Plexus Asset Management, which he founded in 1995. The group conducts investment management, investment consulting, private equity and real estate activities in South Africa and a number of foreign countries. He also serves as Honorary Consul of Slovenia for South Africa, actively developing economic, cultural and scientific relations between Slovenia and South Africa. Prieur is 54 years old and live with his wife, television producer and presenter Isabel Verwey, and two children in Cape Town, South Africa. His leisure activities include long-distance running, traveling, reading, motor-cycling and scripophily. Read more from the author/contributor here.
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