Bill Gross: Bonds, Stocks, Real Estate Overvalued Due to 0% Rates, Sees Recession Risk

Bill Gross, co-founder and co-CIO of PIMCO, had an interesting investment outlook out for October titled Six Pac(k)in'. It doesn't sound good folks. Here's an excerpt.
"sovereign balance sheets resemble an overweight diabetic on the verge of a heart attack. Still, if global policymakers could focus on structural as opposed to cyclical financial solutions, New Normal growth as opposed to recession might be possible."

"almost all remedies proposed by global authorities to date have approached the problem from the standpoint of favoring capital as opposed to labor. If the banks could just be stabilized, if the “markets” could just be elevated back in the direction of peak 401(k) levels, if interest rates could just be lower so that borrowers would inevitably take the bait, then labor – job creation – would inevitably follow. It has not."

"Long-term profits cannot ultimately grow unless they are partnered with near equal benefits for labor. "

"There are no double-digit investment returns anywhere in sight for owners of financial assets. Bonds, stocks and real estate are in fact overvalued because of near zero percent interest rates and a developed world growth rate closer to 0 than the 3 – 4% historical norms. There is only a New Normal economy at best and a global recession at worst to look forward to in future years."
Continue reading at PIMCO.

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