(Bloomberg News) Bill Gross, who runs the world's biggest mutual fund at Pacific Investment Management Co., said there is no evidence that investments are being incented by the Federal Reserve's quantitative easing program.

"All of the money being created and freed up is elevating asset prices, but those prices are not causing corporations to invest in future production," Gross wrote in a monthly investment outlook posted on the Newport Beach, California-based company's website today. Lower interest rates are being used "to consume as opposed to invest," he said.

Investors should recognize that asset and currency prices ultimately rest on the ability of the economy to grow, Gross wrote. If real growth is stunted in the U.S. and globally, than investors should also acknowledge "bite-sized" future returns and the growing risks of "misguided" monetary and fiscal policy that may disrupt financial markets at some point. The so- called fiscal cliff may be the first of a series of disruptions, though Gross expects some type of compromise on the possible tax increases and budget cuts.

Treasury yields should stay low in this type of environment, while what Gross has called the "cult of equity" or even total return, is over, he reiterated, if that presumes a resumption of historical patterns anywhere close to "double digits."