PIMCO’s Gross Bets on Agency Mortgage Debt — and Wins

Of course, Gross has been making headlines and grabbing the attention of policymakers with continued bantering around what to do about “the subprime problem,” most recently suggesting that government-subsidized write-downs of mortgages in the private-party market would help stanch price declines. (See earlier HW commentary on the issue here).

But he surely hasn’t been investing in that space, instead favoring an age-old tactic used by most successful fund managers: divert attention into one area, while acting in another.