Bill Gross, co-chief investment officer at Pacific Investment Management Co., talks about the impact of the Federal Reserve's asset purchase program on the economy.
“What really happens, and this is critically important, is that the Treasury issues bonds and the Fed buys them and then it remits interest to the Treasury,” Gross, who runs the $285 billion Total Return Fund, said in an interview on Bloomberg Television with Betty Liu. “It means the Treasury is issuing debt for free. There are complications. Inflation is one of the complications.”