PIMCO’s Bill Gross increased his holdings of Treasuries to the highest level since July 2010, while billionaire investor Warren Buffett called them “dangerous,” Bloomberg reports.
Gross boosted U.S. government and Treasury debt to 38 percent of assets in Pimco’s $250.5 billion Total Return Fund, the world’s biggest bond fund. The position in January climbed from 30 percent in December, according to a report on the company’s website yesterday.
Buffett, the chairman of Berkshire Hathaway Inc., said taxes and inflation should dissuade investors from debt. That puts him in the camp with Laurence D. Fink, chief executive officer of BlackRock Inc., the world’s largest money manager, who said this week investors should have 100 percent of their holdings in equities because they offer higher returns than bonds.
“They are among the most dangerous of assets,” Buffett said yesterday in an adaptation of his annual letter to shareholders on Fortune magazine’s website. “Over the past century these instruments have destroyed the purchasing power of investors in many countries, even as these holders continued to receive timely payments of interest and principal...”
Find out more at http://www.businessweek.com/news/2012-02-11/gross-buys-treasuries-as-buffett-says-bonds-are-dangerous-.html
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