In Defense of Bill Gross

I really wish there was a way to buy Bill Gross stock. Investing in Pimco’s Total Return Fund is an option, of course, but today I wish there was a way to actually invest in Bill Gross, who I’m sure would be trading at a deep discount relative to a few months back. Once his former heir apparent, Mohamed El-Erian, announced that he would be leaving the firm, the rumor mill started spinning. Story after story has come out since; illuminating the world to what Gross is really like behind the scenes.

My response to most of this has been pretty consistent: so what? Okay, Gross is actually an asshole. Okay, he’s a difficult and demanding boss. Okay, he has actively worked to maintain his authority at the firm. Okay, he wasn’t universally beloved by his employees. SO WHAT?

If several former employees from Berkshire Hathaway came out and said unflattering things about Warren Buffett’s management style, would that change how I respect and revere him as an investor and manager? Absolutely not. One of Bill Gross’ reported quotes that the media has harped on is “I have a 41-year track record of investing excellence… what do you have?” I’m not arguing that comments like this are tactful or that they represent how managers should behave. I’m just saying that I don’t care that Bill Gross is actually a jerk in real life. The bottom line is that he’s right… he does have a multi-decade track record of superior returns in the bond world.

Suppose that someone released footage of Usain Bolt yelling “I have a multi-Olympic track record* of sprinting excellence,” at one of his training partners. There are more diplomatic ways of doing this, but the accomplishments of Bolt and of Gross are both very real and very impressive. As prospective investors, that’s what is most important, not whether or not Bill Gross is adored by all of his employees.

 

*pun intended.

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