Bill Gross, PIMCO founder and co-chief investment officer, stated that Greece is heading for default. The downgrade of European ratings by Standard & Poor’s last week shows countries can fail to meet their debt obligations, Gross said in a Twitter posting, according to Bloomberg.
Greece will prove to be the latest example, Gross wrote.
“The bulk of sovereign-bond holdings should be in the U.S.,” Gross wrote Jan. 4 on the Newport Beach, California, company’s website. Investors should favor Treasuries, he said, “as long as European credit implosion is possible.”
The Total Return Fund gained 4.2 percent in 2011, underperforming 69 percent of its peers, according to data compiled by Bloomberg.