A very high profile bulls vs. bears battle when it comes to Treasuries is brewing: PIMCO (PIMCO news) vs. BlackRock (BlackRock news). We've noted that Bill Gross (Bill Gross news), of PIMCO, is putting his money where his mouth is. He has predicted the end of the epic bond rally, and is now said to be furiously selling Treasury bonds. His chief worries apparently are a kick-up in inflation and a strong increase in interest rates.

But BlackRock begs to differ and it's also putting its money when it mouth is. Bloomberg notes the world's biggest money manager, with $3.35 trillion in assets, is rather bullish. "There isn't inflation in the pipeline" and the gap between short- and longer-term yields is "remarkably steep," an executive told the news service. Yields on the 10-year are particularly high right now, and that has drawn a lot of buyers. The bet seems to be that inflation and interest rates are in check in this slow-motion recovery, and demand will remain healthy for longer-term bonds. The relatively high-yields may thus have room to decline. Rarely do such high profile firms fundamentally disagree. We'll see who wins.

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