Memo to Bill Gross: don't share your trading tips on Twitter again

US Outlook

Bill Gross had such an awesome idea earlier this week that he just had to tell the whole Twitter world about it (Getty Images)

When it comes to social media, the first rule for money managers is to leave Twitter to the kids. The second rule is don’t break the first rule.

JPMorgan learnt this lesson the hard way. It ran an “Ask us anything” Twitter Q&A session way back in 2013, which was abruptly cancelled after it descended into farce – either that, or people asked some pretty pertinent questions, depending on your point of view. JPMorgan was not alone in thinking that what’s cool for the kids must by default also be cool for corporations, but it hasn’t made that mistake twice.

However, the lure of 140 characters keeps on proving too strong for 70-something Bill Gross to ignore. The former Pimco partner and one-time manager of the largest investment fund in the world once indulged in a Twitter feud with the activist investor Carl Icahn, another septuagenarian who should know better.

Mr Gross had such an awesome idea earlier this week that he just had to tell the whole Twitter world about it.

What is this great idea? To short German government debt – in other words, rather than buy in the hope that it will rise in price, sell it in the hope that it will fall in price. Not only does Mr Gross think it’s a great idea, it’s “the short of a lifetime” – a variation on a phrase made famous by generations of snake oil salesman.

That is not to accuse Mr Gross of being a snake oil salesman. He is far from that and has proved his worth to investors (and investment companies) for many years. His point about the 10-year Bund being overvalued is also completely valid – lending the German Government money for a decade at a current return of less than 1 per cent is a rotten deal.

But how much does Mr Gross think this “short of a lifetime” could return? Perhaps 10 per cent over two years. Ten per cent! In two years! And to think that bond investors are always complaining that their market doesn’t get the coverage it deserves from the media. The short of a lifetime might return 5 per cent annually. That’s why.

At some point the price will indeed fall and the yield will rise, but hold your horses: according to Mr Gross, that is only going to happen when the EU stops quantitative easing. When will that be? Who knows. At least he was kind enough to clarify that point subsequently to his Twitter followers.

Mr Gross compared this opportunity with George Soros hammering the pound out of the European exchange rate mechanism in 1992, even if his tweet did suggest it was 1993, by which time Mr Soros had already made his billions and got out. And, as several observers have pointed out, if the Bund corrects to the same degree that the pound did, we’ll be in the middle of the financial apocalypse.

More than just being a good fund manager, Mr Gross has always been a master of marketing and self-promotion. But can you imagine George Soros tweeting his best short idea for just anyone to hop on board? Exactly, and that’s why Bill Gross will never be George Soros.

High times for marijuana as celebrities sponsor weed

I don’t really get the whole 4/20 “Weed Day” thing, especially the fact that for some weird reason Americans insist on putting the month before the day. I also wonder whether 4/21 has become the international surprise drug-test day.

Anyway, never mind that, here’s what more and more investors are coming to realise: the marijuana industry is going to explode. The value of the annual market for legal highs is expected to grow to $40bn (£26bn) a year.

That might sound like a bullish estimate but it could end up much larger. Colorado is one of two states to have legalised marijuana for recreational purposes (another 13 have legalised medicinal marijuana). With less than 2 per cent of the US population, Colorado’s residents spent around $800m on cannabis products last year, in the process generating approximately $76m of taxes and other fees for the State coffers. It’s no surprise that many governors, most with gaping holes in their budgets, are willing to reconsider their opinions.

So what better way to celebrate the mainstreaming of marijuana than to add a celebrity name to some weed? Famous tokers, or at least their surviving children, have not been so wasted that they haven’t had time to put their names to brands. The singer Willie Nelson, actor Tommy Chong and reggae legend Bob Marley (via his estate) are about to launch their own strains of weed, while the singer Melissa Etheridge is planning on launching her own brand of cannabis-infused wine.

The rap star Snoop Dogg is in on it, of course, though only as a venture capital investor rather than putting his name on a blunt. How (high) times change.

As it happens, there is a very good reason for attaching a celebrity name to something that is still much more illegal than legal. The US Patent and Trademark Office is run by the Federal Government, and it will reject any application to trademark a marijuana product.

Federal trademarks are only applicable to products that are used in interstate commerce, ruling out anything to do with a product that is only really legal in Colorado and Washington State. Nobody has ever transported marijuana across state lines, of course.

That also means marijuana makers can only apply for intellectual property protection on a state-by-state basis, and even then there’s no guarantee that they will get it.

And that’s where a celebrity endorsement comes in. Stars have something better than a trademark – publicity rights to their name and image that are already federally registered and recognised.

Adding a celebrity name to a product allows marijuana growers to get national coverage for their intellectual property without having to apply for recognition from the Federal Government.

So who is left on the market? James Franco, Seth Rogen and Woody Harrelson are still available and none of these actors has shied away from talking about their love of marijuana. I wonder if Boris Johnson is up for it?