Central banks are stuck in a permanent cycle of low interest rates and money printing that bond guru Bill Gross said eventually will blow up.
In his monthly newsletter for clients, the Janus Capital portfolio manager again railed against policies from the Federal Reserve and its counterparts around the world that he said have inflated asset prices but have done little to boost economic growth.
He likened the easy-money efforts to “financial methadone,” in which the Fed’s withdrawal of stimulus has been met with increased efforts from the European Central Bank, the Bank of Japan and elsewhere.
The global central bank balance sheet has surpassed $12 trillion, Gross said. At the same time, Fitch Ratings recently reported that global sovereign debt with negative yields still surpasses $9 trillion.
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