High profile bond money manager, Bill Gross is out with a new outlook report on the economy.
"[T]he bull market 'supercycle' for stocks and bonds is approaching its end," writes Gross according to Bloomberg.
This dovetails somewhat with my view detailed in the EPJ Daily Alert, where I warn that interest rates bottomed at the start of 2012 and that we are in for years, if not decades of higher rates.
“Credit-based oxygen is running out,” Gross writes in the outlook, titled “A Sense of an Ending,”
Anyone who holds the view that the Fed will not soon raise interest rates,and soon, fails to understand the nature of the developing crisis. It will be led by a collapse of the bond market.
Market forces, somewhat misleadingly called bond-vigilantes, will lead the charge.
I am not as bearish in the short-term on the stock market. The equity markets will be volatile becasue of the climb in rates and look scary at times but the death spiral will be in the bond market.