Chris: All right, let's talk about the stocks that are on our radar. Shannon Zimmerman, we will start with you.
Shannon: So it is not a stock, it is an ETF. We talked three or four weeks ago about Bill Gross, the founder of Pimco, probably the smartest fixed-income guy on the planet, reversing his bet. He was betting against U.S. Treasury debt and going long on corporate. Now he hasn't reversed on the corporate side, but he has reversed on treasuries, so he is buying Treasury bonds. Lo and behold, either he was a fly on the wall at the last Federal Reserve meeting or his decisions are influencing the way the Federal Reserve Governors approach their work. But now, some folks are apparently concerned about deflation, which we have discussed on the program.
One thing that has been on the table, or is now on the table is the Fed purchasing longer-term government debt, which would also have the effect of keeping interesting rates low. If so, that is going to be great news for longer-term Treasury debt. And so the investment idea is iShares 10+ Year Government/Credit Bond ETF (NYSE: GLJ), a government/credit bond fund that has both Treasuries and corporate debt. Look it up. It makes a lot of sense if you buy that thesis.
Chris: James Early?
James: Chris, I am going to Minnesota, Seth's state, the state that gave me a $50 ticket for picnicking without a permit. (Laughter.) General Mills (NYSE: GIS) is my stock. Obviously you know it -- it just raised its dividend 17%. It has a 29% return on equity. I like that 10% of its sales convert into free cash flow. The "Big G", as it desperately wants to be called but never will because you can't give yourself your own nickname, makes Cheerios, Wheaties, Chex and my favorite --- Fiber Choice. Eat five bowls and call me in the morning.
Chris: And once again, the inner turmoil of James Early, picking stocks that he is just fundamentally opposed to. What was it, last week or the week before when you pickedMcDonald's (NYSE: MCD)?
Chris: Seth Jayson?
Seth: I am going to go back to the well on BP (NYSE: BP). With the cap sort of on and I think most of the money already set aside for what the cleanup will cost, I think they can absorb any problems that are upcoming. The stock is kind of bouncing back a little bit, I think it is a good time. And I own BP, so I could be just talking my own book.
Chris: Everyone is duly warned.
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