Rolling Down the Yield Curve February 8, 2002February 21, 2017 David Smith: ‘Check out this very good article by Bill Gross of PIMCO about long-term trends.’ ☞ Bill Gross is so smart! I got to interview him for a PBS series years ago, and he just blew me away. Here’s what I wrote about him in this space on December 11, 1997: Bill Gross manages $90 billion or so in bonds, which has to be really boring until you realize that he somehow manages to squeeze an extra 1% return out of his portfolio year after year-an extra $900 million. But the image that impressed me even more, as we looked from his Laguna Beach living room out over the Pacific, was of a 53-year-old man determined to live to 100, getting it into his mind to run from Carmel to the Golden Gate Bridge-five back-to-back marathons over five successive days. On the last day of this run, his kidney ruptured. Blood was running down his leg. But he hadn’t reached the bridge, so he kept running. Only when he finished did he allow the ambulance to whisk him away. It may be worth noting that if you try to beat the markets, you’re competing with guys like Bill Gross. (If your 401(k) offers a bond fund managed by PIMCO, it could warrant serious consideration.) Those who don’t live and breathe yield curves may find his article – though deft and colorful – hard fully to follow. But that’s OK. If nothing else, it will give you a sense of the complexity of the markets and the difficulty of steering our economic ship. A ZERO PERCENT TAX ON CERTAIN CAPITAL GAINS? Several of you raised good and interesting objections to last week’s idea of a zero percent tax on capital gains realized from the purchase of newly issued securities. I hope to get around to presenting those objections, but in the meantime just wanted to note that my idea did not meet with universal applause. (I still like it, but your objections are very much worth discussion.) AND SPEAKING OF LIVELY DEBATE Tim Galpin: ‘Thank you for including the link on 4 Feb. to Mr. Clinton’s comments in the BBC forum. I confess to being generally predisposed to disagree with his politics and I might not have otherwise seen it.’ ☞ Thanks, Tim. Few things are as impressive as an open mind.