"People are getting used to yields below 2%, " says Brett Rose, head U.S. interest-rate strategy at Citigroup in New York.

WSJ: Is It Time to Sell Treasurys?

Chris Ahrens, head of U.S. interest-rate strategy at UBS Securities LLC. in Stamford, Connecticut, said the 10-year yield could trade in a range between 1.5% and 1.75% over the next three to six weeks.

WSJ: U.S. Stocks Tumble, Treasury Yields Sink to Record Lows

Instead, GM has become what one might call America's subprime auto maker, increasingly dependent on cheap credit, fueled by the Federal Reserve's near-zero interest rate policy, to support its made-in-China production strategy.

WSJ: Edward Niedermeyer: Welcome to General Tso's Motors

Even if the Fed doesn't ramp up its mortgage buying, an interest-rate shock could derail Mr. Gross's strategy.

WSJ: Bond King's Trade Pays Off

For one thing, it is hard to know how much companies have in fact lengthened the maturity of their debts because the interest-rate swap market allows them to swap those fixed bond payments into cheaper floating debt, a popular strategy in the investment-grade market.

ECONOMIST: Better to feast on cookies than junk bonds

In the run-up to the G20 summit in Seoul, Lula's finance minister, Guido Mantega, told journalists that Ms Rousseff "wants to work with lower interest rates" - a move that puts her at odds with Mr Meirelles' avowed strategy of using rate rises as "the basic instrument" to control inflation.

BBC: Brazil's inflation hawk Henrique Meirelles bows out