There are green shoots, but not much more.

So says Bill Gross, the manager of top bond fund Pimco, who forecasts the U.S. economy will grow a paltry 1 percent to 2 percent annually over the next few years.

But despite the subdued outlook, the manager of the world's biggest bond fund said some investments should deliver stable income, with returns of 6 percent to 8 percent a year in sectors ranging from high-quality corporate bonds to conservative stocks.

For instance, he cited Coca-Cola Co and Procter & Gamble Co

as attractive stocks.

Growth will be subdued, he said in a brief interview on Thursday while attending a conference hosted by Chicago research firm Morningstar Inc. Get used to 7 to 8 percent unemployment for years to come.

The most severe U.S. recession in decades has already cost over 5 million jobs since it began in December 2007 and the unemployment rate hit 8.9 percent in April, the highest since September 1983.

Gross, co-chief investment officer of bond investing giant Pacific Investment Management Co, manages the Pimco Total Return Fund, which has $154 billion in assets.

He attributed a slide in the U.S. government bond market on Wednesday to fears there would not be enough buyers for the $3 trillion in recent U.S. borrowing.

There's a gap because the market is worried who's buying these securities, he said.

U.S. Treasuries recovered on Thursday as dealers wondered whether the selling was overdone given that much of the downward move came on the back of mortgage-related trades.

(Reporting by Ross Kerber; Editing by Jason Szep and Andre Grenon)

Investment