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To: patron_anejo_por_favor who wrote (241412)	5/19/2003 2:46:46 PM
From: Pogeu Mahone	Read Replies (2) \| Respond to of 436258

Gross thinks stocks are 20-25% overvalued

To: patron_anejo_por_favor who wrote (241412)	5/19/2003 2:50:47 PM
From: Giordano Bruno	Read Replies (2) \| Respond to of 436258

Gross says U.S. stocks 20-25% overvalued By Jonathan Burton, CBS.MarketWatch.com Last Update: 9:41 PM ET May 16, 2003 SAN FRANCISCO (CBS.MW) -- Bill Gross, chief investment officer of bond powerhouse Pacific Investment Management Co., or Pimco, said Friday that the U.S. stock market is "20 to 25 percent overvalued" at current prices, and also sees frothiness in the euro. "The United States still has a little remnant of the bubble," Gross said in an interview with CBS.MarketWatch.com. He expressed surprise when told that Internet auctioneer EBay (EBAY: news, chart, profile) had flirted with $100 a share on Friday. EBay closed the week at $99.19. But Gross, an influential investor who oversees $345 billion in bonds, added that even with stocks at levels he considers inflated, "that doesn't mean Dow 5000 is imminent." Gross, manager of $74 billion Pimco Total Return (PTTAX: news, chart, profile), the world's biggest bond mutual fund, said he's bearish on prospects for large corporations with unrecognized pension obligations that "fail to recognize future realities" they must resolve. "We're bearish on companies with high debt levels, large pension obligations that haven't been recognized, and inappropriate accounting that fails to reflect future obligations," he said, declining to be more specific. When Gross talks, investors listen. He caused a stir in General Electric (GE: news, chart, profile) shares in March 2002 when he raised questions about the company's short-term debt. In the interview Friday, Gross also noted that the euro is "a little" overvalued at $1.16. The strong euro "is definitely killing European manufacturers and European exports," he said, but added that he has no plans to speculate in currencies and sold a 2 percent long position on the euro two months ago. Friday's interview took place at a function for Fremont Investment Advisors, a mutual fund firm for which Gross manages the $1.3 billion Fremont Bond (FBDFX: news, chart, profile) fund.