Bill Gross says he’s buying futures tied to the Secured Overnight Financing Rate and sees a recession in the fourth quarter.

Posting on X on Monday, Gross said he expects the gap between two- and 10-year yields as well as the difference between two- and five-year yields to go positive before year end.

Regional bank turbulence and the rise in auto-loan delinquencies suggest a significant slowdown in the US economy, he noted.

Equity arbitrages would make the “best investment,” Gross said, adding that he was “seriously considering regional banks again.” 

This article was provided by Bloomberg News.