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The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
an InvestmentWires' Publication
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MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
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Monday, October 17, 2011 Gross' Mea Culpa is a Hit Pimco's PM may have lost the ball in the sun but his apology letter is a hit with the media. The question is: How many marketing dollars is embarrassment worth? In case you missed it, the world's business reporters received manna from heaven when Deal Breaker got its hands on Bill Gross' apology letter sent to Pimco Total Return Fund shareholders. Bess Levin of Dealbreaker spins Gross' three-page mea culpa missive in the context of another recent letter in which he talked about feeling fat. "He eats when he underperforms and when he underperforms he eats," Dealbreaker writes. "Rather than asking for your forgiveness, he should be asking that you get off his ass so he can get back to business." In the letter Gross admits that "Pimco's centerfielder has lost a few fly balls in the sun" and explains that the world blew past the "New Normal" he predicted. He had expected two percent percent real growth in the developed world but got zero. The coverage spread, reaching hard news outlets such as Reuters and Web media such as Business Insider where Joe Weisenthal points out that Gross' strategy shift may be too late, that "his new bet on lower rates and horrible growth is already looking out of step (maybe)." Even Princeton Nobel Laureate Paul Krugman -- who doesn't usually concern himself with mutual fund PMs -- takes aim. Krugman writes "I told you so" to Gross, as he criticized Gross' then-inflation-averse strategy back in June. Murray Coleman of Barron's describes Gross' letter as "interesting" and reminds readers that, despite the recent underperformance, Pimco Total Return has a very strong longer-term track record. On the other coast, Gross's hometown Los Angeles Times' writer Tom Petruno simply lays out Gross' apology and the context, without too much reaction one way or the other and notes that Total Return is down 2.2 percent over the last month alone, "making it one of the worst-performing bond funds in that period." Bloomberg's Sree Vidya Bhaktavatsalam sees a stinker and outlines Gross' letter and offers a response from a billion-dollar advisor, Brouwer and Janachowski chairman Kurt Brouwer. The apology also made waves on the other side of the Atlantic. Michael Mackenzie and Dan McCrum of the Financial Times offer reactions from DAL Investment president Janet Brown, Lipper senior research analyst Jeff Tjornehoj and Harris Private Bank chief investment officer Jack Ablin. The duo also praise Gross' "rare ability to manage his fund irrespective of its size." The Telegraph's Richard Blackden calls Pimco Total Return "the highest-profile casualty of a bond market that is still vexing investors." In "Pimco's Mea Culpa", the Reformed Broker (i.e. Joshua Brown) reacts by writing that "Gross is now more bearish on developed world growth prospects than he was in the summer." Printed from: MFWire.com/story.asp?s=38071 Copyright 2011, InvestmentWires, Inc. All Rights Reserved |