CIO of the world’s largest bond fund admits defeat, signaling U.S. distressed property notes as the only investment left with tasty returns…
Another Investment Sector Bites the Dust
Following on economist Robert Shiller’s comments earlier this year that double-digit stock returns were a thing of the past and the outlook suggesting 2-4% returns going forward, the world’s largest bond fund predicts the same for equity funds. CIO of Pimco, Bill Gross recently told Bloomberg that even returns of 6.6% above inflation are a thing of the past and that investors expecting high returns are going to be “disappointed.”
So with stocks, treasuries, and private equity bond funds down for the count, and gold still sliding, where can investors find acceptable returns?
Exotic Locations or Spinning the Wheel in Las Vegas?
Some have pointed to the new reality of ridiculously low returns as a signal it is time to invest overseas. Of course with Europe, China, and even Canada on the ropes, that suggests a few remote, exotic locations which “promise” returns along with a ton of risk and no protection. If you’ve got the guts for that, lots of money to burn, and love gambling, by all means take a shot, though you might be better off heading to the tables in Vegas. At least you’ll get a couple free drinks, be able to take in the lights, and might have a chance at getting a free room upgrade.
Not loving those odds?
Limited Opportunities to Lock into Secure Investments with Great Returns
Pimco’s Chief Investment Officer pointed out two major threats to investors in his recent interview: low interest rates and inflation.
We already know that real estate is the ideal investment vehicle as a hedge against inflation and great for lowering tax liability. Unfortunately, rates remain depressed and they aren’t printing returns like they used to.
Fortunately there is a unique, though limited window of opportunity to scoop up attractive distressed property notes with large security cushions and high returns right now.
Will you seize on it or let it pass you by?