Bill Gross Warns Against Owning Bonds, Favors One-Year T-Bills

Moneywise.com under the title··US·Read original
3▲0 ▼0Impact / 5
Summary · why it matters

Bill Gross, co-founder of Pacific Investment Management Company, warned investors against owning longer-term bonds in a Sept. 30 op-ed for the Financial Times, writing bluntly, "Don't own bonds." His central concern is the roughly $84 trillion in U.S. government, mortgage and corporate credit, with U.S. government debt now at 100% of GDP, a level he called a "peacetime high." The only bond-market corner he still favors is short-term Treasury bills, specifically one-year T-bills yielding 4.55%, arguing investors are not adequately compensated for duration risk even with the benchmark 10-year Treasury yield above 5%. Gross also flagged the AI infrastructure buildout as a corporate risk, noting hyperscalers including Amazon, Microsoft, Alphabet and Meta Platforms have vowed to spend roughly $750 billion this year on AI-related investments, with AI-related investment forecast to eclipse $1 trillion next year and Goldman Sachs projecting as much as $1.4 trillion in 2027, much of it likely funded by debt.

Impact on assets 5

Artificial Intelligence▲
Amazon.com Inc
AMZN
± MixedCapitalrelevance

Named among hyperscalers whose ~$750B AI capex, much debt-funded, Gross flags as a corporate risk.

Alphabet Inc Class C
GOOG
± MixedCapitalrelevance

Named among hyperscalers whose ~$750B AI capex, much debt-funded, Gross flags as a corporate risk.

Microsoft Corporation
MSFT
± MixedCapitalrelevance

Named among hyperscalers whose ~$750B AI capex, much debt-funded, Gross flags as a corporate risk.

Spatial Computing / AR/VR▲
Meta Platforms Inc.
META
± MixedCapitalrelevance

Named among hyperscalers whose ~$750B AI capex, much debt-funded, Gross flags as a corporate risk.

Financials▲