Why Pimco holds 31% cash and -3% bonds

From Arabian Money:

The world’s biggest US ‘bond’ fund is no longer in bonds and has a net short position, and holds an amazing $73 billion in cash. What is former Las Vegas poker player and one-time ‘bond king’ Bill Gross up to? This is what Mr Gross says he would tell a Congressional hearing:

‘I sit before you as a representative of a $1.2 trillion money manager, historically bond oriented, that has been selling Treasuries because they have little value within the context of a $75 trillion total debt burden. Unless entitlements are substantially reformed, I am confident that this country will default on its debt; not in conventional ways, but by picking the pocket of savers via a combination of less observable, yet historically verifiable policies – inflation, currency devaluation and low to negative real interest rates.’......read on