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Richard's Remarks


"So the Total Return Fund, as all bond funds, has done well in part because interest rates have gone down, down, down." Bill Gross



Bill Gross is one of the smartest and most successful investors in the business. He was the guy who coined the expression, "the new normal." By that he means that interest rates are now close to zero; they can't go down any further than that. Thus the "new normal" implies investing in a world where we don't have the bullish advantage of ever-lowering interest rates.


This means that we have to make a difficult choice. We can invest in various closed-end funds that provide dividends of 5-6% or we can choose growth, which means buying top-grade blue-chip stocks which provide dividends in the 3-4% range -- and hopefully they will grow.


The problem with closed-end bond funds is that you are faced with a gradual loss of purchasing power if ... Log in or subscribe to continue reading.

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