The "Bond King" Bill Gross offered attendees of the Morningstar Investment Conference a sobering market outlook according to MarketWatch. Gross outlined a "New Normal" that includes lower returns, decreased U.S. growth, and the loss of the dollar's status as the world's reserve currency.

Gross commented that in a world of more regulation, private-sector deleveraging, and less consumption, it’s hard to imagine that Dow Jones climbing back to 14,000 or home prices returning to 2006 levels.

"Growth will be stunted," Gross noted. "It will be a different type of world and we have to get used to that."

Gross expects the U.S. economy will grow between 1%-2% over the next three to five years, rather than the recent norm of 2%-3%. Gross expects the lower growth rate will have a significant effect on corporate profit growth. Unemployment will be 7%-8% and will be at the level "for a long time to come."

Other forecasts from Gross are that inflation will start to accelerate in three to five years and the U.S. will lose its reserve status as the U.S. simply has too much debt.

Gross recommends investments outside the U.S in areas that will grow such as Brazil, India, and China. Gross pointed out that consumption in China is 35% of Gross Domestic Products compared to 70% in the U.S., which displays China' huge growth potential.

Gross' comments are a sobering outlook on the U.S. economy and highlight the need for investors to seek alternative investments such as farmland. The "New Normal" is consistent with our thesis of a weak dollar and high inflation. Factors we believe will drive commodity and farmland prices higher. Also, as developing countries (Brazil, India, and China) continue to prosper, they will continue to put demand pressures on the world's grain market.

- Colvin