10 votes

PIMCO Total Return dumps U.S. government-related debt

"PIMCO's Total Return Fund, the world's biggest bond fund, has dumped all U.S. government-related securities, including Treasuries and agency debt, a source familiar with the fund's holdings said on Wednesday.

In January, Pacific Investment Management Co.'s $236.9 billion Total Return fund slashed its U.S. government-related debt holdings to the lowest level in at least two years and increased cash and debt holdings from other developed nations."


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No Kidding- I had that same thought too

Makes you wonder which one of these moves is going to be the "BIG One" or will some tiny event in some remote part of the world bring the whole mess crashing down??

SteveMT's picture

Answer from Gross: Why Pimco Dumped Treasurys?

On Thursday March 10, 2011, 3:27 pm

"It's not a question of dissing the United States or questioning the credit of the United States, but simply a maturity reflection," Gross said.

"When a trillion and a half dollars worth of annualized purchasing power disappears I simply question as to who will buy them and at what yield," he said. "We're suggesting at these yields it might be problematic."

"So we've moved into Brazil and Mexico and moved money, yes, at the margin into Spain, which has a better balance sheet than the United States."


What's the difference?

What is the difference in holding a Federal Reserve Note and a US Treasury Note?

The Federal Reserve Note (aka US Dollar) is a debt note created out of the issuance of Treasury securities. It is money out of debt and the debt is Treasuries.

PIMCO just traded one from of US debt for another. They better trade those FRNs for something that holds value.

FedRes Audit showed PIMCO at discount window.

I think this means they are a memeber of the Federal Reserve System.

By law Federal Reserve members are guaranteed 6% per annum profit after expenses on the money they'e invested. I wonder how they game the system.

Free includes debt-free!

If this becomes contagious, things will get fugly and fast.

Consider this a shot across the bow.

Finalize all preps, and sleep with one eye open.

Trading paper + interest for cash w/o interest?

Portends purchase. What to purchase, is the question.

Buy what you need. Save what you feel holds value & your interest.

Disclaimer: Mark Twain (1835-1910-To be continued) is unlicensed. His river pilot's license went delinquent in 1862. Caution advised. Daily Paul

good find

I saw the article on this at ZeroHedge.

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Another in a long line of eyebrow-raising..

...jaw-dropping, "Holy Sh*t" moments.

They are beginning to lose their shock value.

I may not know the truth, but I know when I'm being lied to...


any close below 76.20 apparently would be the point of no return. http://money.ca.msn.com/video/?cp-documentid=2bb4b99a-9a6a-4...

fireant's picture

As heavy as the shorts are, it's likely to spring back up.

Actually, there is historic support at 74 as well. Most importantly though, the shorts are as extreme now as they were at other major lows, signaling a contrarian turn-around which can be strong once the shorts run for cover.
It's also worth noting the scenario's discussed rely on the assumption of a continued strong stock market. not a slam dunk. Long term, he's right, but I would not be suprised to see a sudden turn around soon for the intermediate term.

Undo what Wilson did

Good Find!

"We also have record shorts against the dollar adding more downward pressure"......STUNNING!

This is from the Canadian channel BNN

I wonder if US business channels are reporting this also?

SteveMT's picture

Talk about a dump, this is a dump from hell.

"The Total Return Fund's cash holdings had surged to $54.5 billion as of February 28 from $11.9 billion at the end of January. A PIMCO spokesman declined to comment for this story."

In just eight days, did PIMCO dump $40+B in treasuries? These people are business men, who owe no allegiances to anyone. They deal in facts and trends. This is a WOW, moment. What will this move due to Treasuries?

If the $ starts dropping

If the $ starts dropping, how exactly are they going to stop it. Will the Fed step in and buy all those treasuries?


Gross Drops Government Debt From Pimco Total Return Fund, Zero Hedge Says