Pimco's chief investment officer Bill Gross said on Tuesday that Americans should expect to see 1-2% growth for the foreseeable future.
"We think that the United States is in a one to two percent growth environment going forward and investors should get used to it,” Gross said on CNBC's "Street Signs," calling the current economic malaise the “new normal.”
While he expected the U.S. economy to benefit from the improvement in the housing market and cheap natural gas, Gross said the rise of developing nations has challenged America’s growth prospects. He suggested America adopt “policies that basically fight back.”
Gross said the U.S. should pursue policies that devalue the dollar to make exports and manufacturing more competitive or focus on rebuilding the country’s infrastructure.
In the interim, Gross suggested investors would find more value in economies of developing nations, saying, “that's where the growth is and where the underdeveloped fiscal and balance sheets are.
“That's where investors are going to experience higher returns,” Gross said.
America could benefit in the long run and become an exporter of goods as more developing nations join the global middle class and demand more goods, services, and energy.