Why Is Bill Gross Betting On A Vicious Move Higher In The Dollar?

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Photo: Public Domain Photos via flickr

Yesterday PIMCO reported that it had completely abandoned US government bonds.Perhaps more importantly, PIMCO now has a gigantic position in cash — it’s biggest ever.

Is PIMCO betting on a vicious rally in the dollar?

There are a few reasons it could happen:

  • The crackup of the Eurozone will help the dollar.
  • The end of QEIII is looking more and more likely.
  • Anti-dollar sentiment is extreme.
  • Commodities are all looking peakish, etc.
  • Aggressive spending cuts in DC.

The signs are building up.

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