PIMCO Total Return ETF (NYSEArca: BOND) manager Bill Gross on Wednesday said unprecedented global stimulus from central banks has buoyed stocks and risk assets, but that easy monetary policies are having less of a positive impact over time.

Central banks writing checks and zero-bound interest rates are “increasingly ineffective because we’ve gone about as far as we can go,” Gross said Wednesday at the 2013 ETF Virtual Summit. “The world is attempting to get out of the burden of deflation and high debt levels.”

PIMCO’s bond guru said quantitative easing from the Federal Reserve and other central banks along with extremely low interest rates have provided an “artificial lift” to bonds, as well as risk assets like equities. As a result, most markets are “bubbled.”

Gross said he doesn’t see a major bubble like the dot-com craze or U.S. housing market that will dramatically pop, because central bank policies will continue.

“But risk assets don’t produce what they used to produce,” Gross said. At these levels he says there is risk in terms of higher bond yields and lower price-to-earnings ratios for stocks. The BOND manager isn’t forecasting a recession, but he does see slower economic growth.

Meanwhile, zero-bond interest rates are having an increasingly negative effect on certain business models such as banks and insurers, and pension funds are having a hard time meeting obligations, Gross said.

To keep interest rates low in the U.S., the Federal Reserve is writing about $1 trillion of checks a year, which buys 80% of Treasuries, he noted.

The PIMCO co-founder advised investors to be careful with long-term bonds that could get hurt if inflation picks up after 2013. Conversely, commodities and real assets such as gold and oil should benefit if inflation heats up in coming years. Also, owning solid multinational companies that can raise dividends can provide some protection from inflation, Gross added.

PIMCO Total Return ETF

When asked about the challenges of managing BOND, which has quickly grown to $4 billion in assets after launching in March 2012, Gross said he closely monitors the fund’s performance versus major indexed bond ETFs.

In fact, he said has the ETFs on his screen and tracks them every 10 minutes. [Gross Touts PIMCO ETF’s Active Approach]