Barron's Midyear Roundtable Results (Pimco's Bill Gross)

December 23, 2008 12:32 PM EST

StreetInsider.com is going to take take a look and update readers on the results of Barron's Annual Midyear Roundtable.

The experts in Barron's 2008 Midyear Roundtable that provided their predictions back in June for the rest of '08 include: Bill Gross, Oscar Schafer, Archie MacAllaster, Scott Black, Mario Gabelli, Fred Hickey, Marc Faber, Art Samberg, Felix Zulauf, Abby Joseph Cohen and Meryl Witmer.

These experts gave their predictions on the economy, financial markets and dozens of individual stocks and funds. Many of the experts presciently predicted trouble for '08 and even '09, while several experts got it wrong and saw the "skies clearing at last, even for decimated financial and home-building shares."

In the wake of the Madoff scam, it maybe difficult to trust so-called Wall Street experts. However, I think it is beneficial to follow-up on alternative viewpoints in an attempt to add perspective to your individual portfolios.

Today, we are going to focus on Pimco's Bill Gross's predictions.

Bill Gross said this about the economy: "With the economy down, the Federal Reserve can't raise rates to tame inflation. Yet, higher inflation means it should, or at least should be thinking about it."

When Bill Gross made that statement, the fed funds rate was at 2%, since that time the Fed has cut the rate multiple times and has a target rate of 0% to 0.25%.

At the Barron's Midyear Roundtable, Bill Gross also gave his two favorite stocks picks for the rest of 2008. His picks included Countrywide Financial (NYSE: CFC) and Fairpoint Communications (NYSE: FRP).

Gross thought Countrywide was a good buy because CFC traded at a 10% discount to the price that Bank of America (NYSE: BAC) had agreed to pay in an all-stock deal. However, with Bank of America's stock also taking a hit, this trade did not prove profitable.

Bill Gross's other top equity play was Fairpoint Communications (NYSE: FRP). Since picking Fairpoint Communications on June 11th, it has fallen by almost double the S&P 500's loss, losing just over 60%. Gross liked that Fairpoint bought substantial properties from Verizon Communications (NYSE: VZ) and Fairpoint's handsome dividend yield.

Obviously, Bill Gross's stock ideas didn't fair too well for Barron's readers, but lucky for his Pimco investors, he's a bond guy and not an equity investor.

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FairPoint Communications, Inc. (FairPoint) is a provider of communications services in rural and small urban communities.
Bank of America Corporation is a bank holding company.

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