The Icarus-like career of a Bond King

While Mr Gross already had an admirable track record, the financial crisis of 2008 catapulted him into the league of legends

In the early 1970s, when Bill Gross joined the bond department of Pacific Mutual Insurance Company, bonds were not traded. They sat idle in vaults. Institutional investors were happy to receive just the interest payouts and the principal. The only thought that went into buying them was to ladder their maturities so that the principal flowed back at regular intervals.

In those days, bond trading was deemed too risky and most institutional investors were averse to it. A trader named Howard Raykoff pitched the idea of bond trading to Mr Gross’s boss. The 1970s were a period of high inflation. Bonds