Bill Gross Predicts U.S. Recession in 2022 Despite Strong Economic Data, Recommends Regional Banks and Yield Curve Bets

Bill Gross, co-founder of PIMCO, believes a U.S. recession will start by end of 2022 due to rising auto loan delinquencies and regional bank struggles.

This contradicts Atlanta Fed data showing 5.4% GDP growth in Q3; official Q3 GDP data out Thursday expected to show 4.5% growth.

Gross recommends investing in regional bank stocks like KRE ETF, merger arbitrage plays, and betting on further Treasury yield curve steepening.

10-year Treasury yields are nearing 2-year yields for the first time in over a year as curve breakout approaches.

Gross says "higher for longer" mantra is outdated as slowing economy will force Fed rate cuts sooner than expected.