Americans Can’t Retire When Bill Gross Sees Repression
By Jeff Kearns, Steve Matthews and Katherine Peralta Mar 25, 2014 9:42 AM ET
Twelve years after retiring as a telephone repairman, Roger Wood clocks 12 to 15 hours a week at a Lowes Cos. hardware store near Glen Allen, Virginia.
About the same amount I made 30 years ago, Wood, 69, says of his $12 hourly wage. Im worried about my portfolio because of low interest rates, even to the point of considering full-time again.
Feeble returns on the safest investments such as bank deposits and fixed-income securities represent a financial repression transferring money from savers to borrowers, says Bill Gross, manager of the worlds biggest bond fund. Workers 65 and older, struggling with years of depressed yields, are the only group of Americans who are increasingly employed or looking for jobs, according to Labor Department participation-rate data.
Were going to be financially repressed for decades, Gross, the 69-year-old billionaire co-founder of Pacific Investment Management Co., told Bloomberg Radio Feb. 7, citing Federal Reserve interest-rate policy that aims to cut borrowing costs. I hate to be gloomy, but, yes, for the next 10 years, the oldsters, and Im in that camp, are going to be disappointed in terms of the policy rate.
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http://www.bloomberg.com/news/2014-03-25/can-americans-retire-in-a-decade-of-financial-repression-.html