NEW YORK -- PIMCO Fund Manager Bill Gross is widely hailed as the king of bonds, but conflicting proclamations and a flagging trading record are making some investors wonder whether he deserves the crown.

A former professional black jack player, Gross earned his reputation during the booming 1990s, when volatility was low and sentiment rode high. Now that financial markets are turning shakier, his performance is suffering.

At the same time, his widely quoted market letters have recently sounded contradictory, even erratic, some traders say. During his reign, he amassed the biggest bond fund in the world and now manages over $100 billion. But since funds gravitate to performance, some say his long reign may be over.

"He's cold," said Andrew Brenner, a market analyst at MAN Financial. "He's had a very good long-term track record but his short-term performance is mediocre at best."

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Just a few weeks ago, Gross gave out a major "mea culpa" in which he conceded that his expectations for an imminent string of interest rate cuts had been wrong.

This week, he made another key reversal. He was back to arguing the Federal Reserve would reduce borrowing costs over the next six months, albeit as an "insurance policy" against possible fallout from the crisis in subprime mortgages.

In recent remarks, Gross had announced a sea change in his approach to Treasury bonds, saying he was now a "bear market manager" after a quarter century as a bond bull and downplaying the prospect of lower interest rates.

Asked about his about-faces, Gross argued they were just minor tweaks in an otherwise consistent view of the world.

"I haven't had a change of heart," he said in an email interview. "Those that suggest I or PIMCO as being consistently wrong don't read the written material thoroughly enough."

Other investors see it differently.

"How do you tell the market one day you're bearish and next thing, you know what, given the subprime market I'm a better buyer here?" said Louis Cesario, a bond trader at Hamershlag, Dodeles & Co."These fund guys get away with speaking at both ends of their mouths."

To be fair, Gross acknowledged in a recent newsletter that his long-term outlook "may sound like just the reverse" of PIMCO's short-term forecasts. But bond strategists say that while accolades were once warranted for the PIMCO boss, his returns do suggest he has lost his touch.

A look into his flagship fund, PIMCO Total Return, indicates as much. The fund has underperformed the Lehman Aggregate, a basic benchmark index, for the past two years, according to Morningstar.

His soft streak has gotten worse over time. Data from SmartMoney magazine shows that while Gross' fund ranks 14 out of 100 in its class over the past ten years, his short-run performance has been falling: he ended up in 41st place over the past five years and ranked a paltry 81st year-to-date.

But his errant forecasts have not been limited to the bond market. Back in September 2002, Gross had this to say of equity markets: "Stocks stink and will continue to do so until they're priced appropriately, probably somewhere around Dow 5,000, S&P 650 and Nasdaq God knows where."

Even by his own admission, Gross could not have been further off target. In fact, Wall Street actually hit a bottom less than a month after his comments. Anyone who followed his hunch lost out on a massive four-year rally that carried the Dow well over 13,000.

So what prevents the mega-fund's hefty client base from fleeing for the hills? Analysts say size could be the secret.

With the bulk of its investments in highly-liquid and rather safe fixed-income assets, PIMCO has managed to buffer the pain from downdrafts in the market.

"Fortunately for PIMCO clients, Mr. Gross does not depend on his macro forecasting to earn returns," said David Merkel, senior investment analyst at Hovde Capital.

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