Don Phillips of Morningstar introduced Bill Gross on Thursday by praising the PIMCO leader and other money managers who ply their “noble” trade in public investing vehicles.
He said Gross has made money for many ordinary people: “It’s not noble to make the wealthy wealthier, but it is noble to help smaller investors,” Phillips said to the lunchtime crowd at the 26th annual Morningstar Investment Conference. Phillips, still the much respected, even loved, face of Morningstar, also mentioned that beyond its investing expertise, the behemoth PIMCO led by co-founder and CIO Gross is using its bully pulpit to encourage public companies to put more women on their boards, “which we all agree would be a good thing.”
Not everyone agreed that Gross’ subsequent presentation to the 1,900 attendees was a good thing.
The Twittersphere lit up as he delivered a somewhat meandering speech that went overtime — meaning no questions from the audience — and was by turns very personal, somewhat wonky in describing the PIMCO investing “template,” and finally straightforward in his predictions for the markets.
In this posting I’ll do my own reporting, but I’ll also reference how busy Twitter was with folks commenting on Gross’ speech. So busy, in fact, that the conference’s official hashtag, #MICUS, was trending on Twitter for a time, a rarity for a financial gathering.
Gross walked onto the stage in Chicago wearing sunglasses and a chip on his shoulder. The sunglasses he called a “prop,” which he said 70-year-olds like himself need for public appearances; the chip came from the press coverage he has received over the past year questioning his management of people.
— T Henry Yoshida CFP® (@henryyoshida) June 20, 2014
His money management style has also been criticized, and dollars have been flowing out of his flagship Total Return mutual fund in lockstep with the fund’s subpar performance. However, one of the points he covered in his speech was to offset that performance perception by saying about the fund that “we’re beating our benchmark, before fees.”
He spoke about Total Return’s investing strategy, which “adds 75 basis points in structural alpha each year” by including three kinds of fixed income, including investing in intermediate maturity Treasuries:
— WealthManagement.com (@wealth_mgmt) June 19, 2014
Another point was to assuage the worries of attendees (and his wider audience of advisors and investors) about the overall state of PIMCO. Noting PIMCO had just moved into a new building and that its new six-deputy CIO structure was “working fabulously,” he said “we’re having a good time; we’re a happy kingdom.”