Bill Gross: Why I'm Trying to Go Short on Credit

The transcript discusses the challenges faced by investors in managing short durations and credit risk, emphasizing the difficulty of changing psychological makeup to adapt to market behaviors. It highlights the struggle of being comfortable with short positions and the influence of past market recoveries on current strategies. The speaker, a seasoned investor, shares insights on the systemic risks present in the financial system and the ongoing effort to balance belief in the system with risk management.

What is the primary focus of unconstrained investors regarding bond durations?

• Investing in long-term bonds

• Assuming more credit risk

• Eliminating duration exposure

• Increasing duration exposure

Why do some investors find it challenging to change their psychological makeup?

• Because they have always experienced market downturns

• Because they are new to investing

• Because markets have historically rebounded

• Because they prefer short-term gains

What historical market behavior is mentioned as influencing investor psychology?

• Markets have always been unpredictable

• Markets have never recovered from downturns

• Markets have consistently snapped back

• Markets have always been volatile

What internal conflict does the speaker face regarding risk management?

• Whether to take on more credit risk

• Whether to believe in the system or not

• Whether to invest in foreign markets

• Whether to increase investments in bonds

What belief does the speaker hold about the system despite acknowledging its risks?

• The system is at risk but still trustworthy

• The system is perfect for short-term gains

• The system is infallible

• The system will collapse soon