Interesting contrast between Bill Gross, the largest manager of fixed income in the world at PIMCO, and Warren Buffett, Chairman of Berkshire Hathaway (BRK.A). Gross is heavily invested in U.S. Treasuries and Buffett believes they should come with a warning sign that says, "hazardous to your financial health."
My own belief is U.S. Treasuries are the biggest sucker bet because of the high prices, low yields, and low expectations for inflation. The view in the financial world is that it is the best asset to own which is negatively correlated to stock markets or commodities.
Essentially, by owning Treasuries you are betting the bond market bull run over the last 15 years keeps going unabated. There is a quote in finance that trees don't grow to the sky, but that is just my opinion. I would even lean more towards buying an ETF that shorts 10 year or 30 year Treasuries, but you need a real strong stomach for that, and it has not worked for the last few years. Doesn't mean it won't work, but you could definately feel some pain if Europe falls apart.
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Are Treasuries Worth Owning?
Published 02/13/2012, 05:36 AM
Updated 07/09/2023, 06:31 AM
Are Treasuries Worth Owning?
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