Here's What Happened The Last Time Bill Gross Made A Huge Bet Against Bonds

A great point from PragCap regarding the news that Bill Gross’ PIMCO is short Treasuries.

Here’s how it worked out the last time. He basically top-ticked rates.

chart

It seems cointerintuitive that the end of Fed bond buying would coincide with a big rally. But if you figure that Fed buying has increased the appeal of risk assets (assets that aren’t Treasuries) and that this is coming to an end, it makes sense that the end of the program would correspond with a rally in Treasuries and a decline of rates.

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