In an interesting follow-up to his op-ed from the other day, William Gross has volunteered to manage the bailout at no charge:
NEWPORT BEACH, Calif. — One of the chief concerns about the Treasury Department’s $700 billion bailout plan is that the same Wall Street firms that helped create the crisis could make a killing cleaning it up.
William H. Gross, the manager of the country’s largest bond mutual fund, has a solution: he is offering to sort through the toxic assets — free.
“We have a large and brilliant staff that can analyze and has analyzed subprime mortgages that can help the Treasury out,†Mr. Gross, the co-chief investment officer for the Pacific Investment Management Company, said in an interview at the company’s headquarters here.
He added, “And I’d even be willing to say that if the Treasury wanted to use our help, it would come, you know, free and clear.â€
Mr. Gross explained his offer as a philanthropic one. With Pimco’s $830 billion under management, “we make fees aplenty,†he said. That could be considered an understatement. Pimco is a behemoth in credit markets, and Mr. Gross talks about them with a confidence that reflects his ability to maneuver in them.
Timeo Danaos enim dona ferentes. PIMCO is certainly qualified but I doubt that Mr. Gross’s offer is completely self-less. Managing the bailout could be the best seat in the house for an investor. Nothing like insider information for knowing which way to jump.
