06/17/96 'I WOULD MUCH RATHER OWN A BOND RIGHT NOW'

'I WOULD MUCH RATHER OWN A BOND RIGHT NOW'

Fuss, of Boston's Loomis, Sayles & Co., is a stock-market bear and bond-market bull if ever there was one.

ON THE ECONOMY
-- ``It's cooking along, but it's not a boom. That's a fairly friendly environment for investing money. The bad news is that in the U.S., the stock market seems to have anticipated this--and then some.''

ON LONG-TERM INTEREST RATES
-- ``At yearend, I expect the 30-year bond to yield about 6.5%. For short-term rates, about the same [as they are now].''

ON STOCKS VS. BONDS
-- ``In the past, stocks and bonds tended to move in the same direction. Now, I think stocks and bonds are unhinging. I would much rather own a bond right now. And I would put a heavier emphasis on longer-term bonds than normal.''

ON INVESTMENT STRATEGY
-- ``I would build a schedule of maturities. I'd buy a 5-year, 10-year, and 28-year bond. I think most people are probably better off doing it themselves. In Treasuries, you'll outperform three-quarters of the bond funds. Why pay 1.5% to manage a portfolio of 7% yields? It makes no sense to me.''

ON OTHER RECOMMENDATIONS
-- ``I like Canadian long bonds and provincials, and New Zealand and Irish governments. I would avoid investment-grade corporates. Wait until fall to buy junk, but the Kmart BB bonds are still cheap.''