Gross Says Europe Won’t Escape Debt ‘Straitjacket’ for Years

[Javaman]

http://www.bloomberg.com/news/2011-11-29/pimco-s-gross-says-europe-won-t-escape-its-debt-straitjacket-for-years.html

Investors should recognize that Europe’s problems are global and it will be years before nations in the region can escape from their “straitjacket” of debt, Pacific Investment Management Co.’s Bill Gross said.

With global growth likely stunted for years and interest rates kept artificially low, investors should consider risk assets in emerging economies such as Brazil and countries in Asia, Gross, manager for the world’s biggest bond fund, wrote in a monthly commentary posted today in the Newport Beach, California-based company’s website.

“Consider Brazil with its agricultural breadbasket and its oil. Consider Asia with its underdeveloped consumer sector but be mindful of credit bubbles,” Gross wrote in the note.

Europe’s sovereign debt crisis that began more than two years ago in Greece and snared Ireland, Portugal, Italy and Spain, now threatens to cost France its AAA credit rating. Italy was forced to pay above the 7 percent threshold that led Greece, Portugal and Ireland to seek bailouts when it sold 7.5 billion euros ($10.1 billion) in bonds today, short of the maximum target for the auction.

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[lapfog_1]

1. Where was this advice / forecast in 2007? - n/t