courtesy of the Fed's printing press which continues keeping prices artificially high. With the Fed en route to purchase nearly one and a half trillion in Agency and MBS paper (for now), it has found eager sellers in the face of PIMCO. MarketWatch reports that PIMCO sold $30 billion in agency paper in September alone, and has sold over $80 billion year to date.

 

 

Total Return Fund's holdings of mortgage-related securities fell from 38% of the portfolio on Aug. 31 to 22% on Sept. 30, the latest date for which figures are available. On July 31, 47% of the fund was in mortgages -- the fund's largest category holding at that time.

The fund's assets under management on July 31, Aug. 31 and Sept. 30 were $169 billion, $177.5 billion and $185.7 billion, respectively.

The last time Total Return Fund had less allocated to mortgages was Feb. 28, 2005, when the level was 19%. The fund's assets under management at that time were $75.8 billion.

PIMCO is not shy in disclosing it is more than happy to take US taxpayers for the proverbial ride: