Even though in public, Bill Gross has been waging a muted war against Meredith Whitney‘s munipocalypse predictions, apparently in private it’s a different story.
According to Charlie Gasparino at FoxBusiness, in meetings with brokers who sell munis “Pimco has launched an all-out war to discredit Whitney’s research.”
All Pimco reps are apparently on the offensive.
Whitney’s doomsday forecasts of a wave of defaults by states, cities, towns and borrowers has triggered billions in redemptions from muni-bond funds, including Gross’ Pimco.
Pimco paid $10,000 to get Whitney’s recent bond report and after reading it, one staffer said it “wasn’t worth the paper it was written on,” and clearly that’s what they’ve been telling their clients.
Also, Pimco reportedly considered having Whitney herself talk to its analysts but then “decided not to because officials there believed her analysis to be superficial,” Gasparino says.
Of course the Pimco posse aren’t the only ones ridiculing Whitney’s forecasts. While Gross’ public sparring has been restricted to fine-drawn barbs, others have been pretty vocal about their disdain, including muni-queen Alexandra Lebenthal and banker Suzanne Shank.