Skip to comments.US in even worse shape than Greece - Pimco founder Bill Gross (America's largest Bond Investor)
Posted on 06/14/2011 7:03:55 AM PDT by SeekAndFind
The founder of one of the largest bond fund management companies in the world thinks the US is in worse financial shape than Greece.
When adding in all of the money owed to cover future liabilities in entitlement programs the US is actually in worse financial shape than Greece and other debt-laden European countries, Pimco's Bill Gross told CNBC Monday.
Much of the public focus is on the nation's public debt, which is $14.3 trillion. But that doesn't include money guaranteed for Medicare, Medicaid and Social Security, which comes to close to $50 trillion, according to government figures.
The government also is on the hook for other debts such as the programs related to the bailout of the financial system following the crisis of 2008 and 2009, government figures show.
Taken together, Gross puts the total at "nearly $100 trillion," that while perhaps a bit on the high side, places the country in a highly unenviable fiscal position that he said won't find a solution overnight.
"To think that we can reduce that within the space of a year or two is not a realistic assumption," Gross said in a live interview. "That's much more than Greece, that's much more than almost any other developed country. We've got a problem and we have to get after it quickly."
The financial community is concerned that we don't have the political will to solve our debt problems. They may be right. It is rapidly becoming clear that the medicine we're going to have to take is going to be long term and bitter. And politicians don't appear to have the courage to accept it.
This is the same "financial community" that came screaming for a bailout two years ago. What a bunch of jokes. And its the same financial community that is pushing Republicans to increase the debt ceiling. They are completely undermining the resolve that at least some people have to face the debt crisis. And its the same financial community that heavily supported the Socialist in Chief in the last election. They have no credibility.
And yet, we do have to do something. We have to cut spending and entitlements. But no one--not even many conservatives--are willing to do so. Talk about extending the retirement age for Social Security and Medicare and you get screams about how people "paid into the system" and so their benefits shouldn't be touched, as if there is some magical pot of money available to be tapped. No one wants to face the fact that Social Security tax money was spend 10, 20, 30 years ago. It isn't there. The only way to "pay back" current retirees is by taxing the sh&t out of current taxpayers, who don't have a prayer of getting back what they paid in.
Most Americans understand what is needed and are acquainted with duty and sacrifice. They accept the challenge and are willing to do what is necessary.
However, not only do we have to fight the actual economic battle BUT, we have to fight the selfish, socialist, anti-American politicians who lack the political will to even allow that an economic abyss in yawning in front of us . much less to squarely meet the challenge and recover ourselves!!
THEY want to retain their STATUS and $$$$ at all cost
THEY want to use OUR tax revenues to buy continued power
THEY could care less what ultimate damage this does to the country and its future
THEY misrepresent the urgency of the situation and distract voters with the emotional, immediate, personal and temporary
Well, the necessary stuff is unpleasant, painful and deeply unpopular. But it's necessary.
I'm just not sure that the financial community really wants it. I would bet that they are actually urging us to take the easy, happy road in which everything has a pleasant outcome for everyone. There's just one problem with that ...
“And politicians don’t appear to have the courage to accept it.”
Neither does the average american. The current mantra is cut his, but leave mine.
Yap, yap, yap.
I have yet to hear even one of the “smart” people suggest bringing back American manufacturing.
Until then, they’re not smart. Just stuck on old scripts.
their STATUS ..that We the People grant them....and $$$$...are OUR tax dollars.
Our politicians conduct, in general, reflects the responsibility, or the the lack thereof, of OUR civic oversight of the work OUR employees are or are not doing.
“Most Americans understand what is needed and are acquainted with duty and sacrifice.”
I’m not sure about the adjective “most”.
We are dangersously close to half the population being on the government dole. Look at the number of people you know that are connected, in some way, with the BigEducation machine alone.
IMO we passed the 51% barrier long ago, now its Republicans for Medicare not small government. Case in point my mother-inlaw, die hard conservative, but hint that she can’t go to a doctor for whatever ails her this week and she goes off her rocker.
Pimco’s head pimp, the Gross one, was an avid supporter for Obozo in the election of 2008.
He, also, told 0b0z0 in 2008 to really spend our money when he became president. See link below:
Bond king Bill Gross called on presidential nominee Barack Obama to double the federal budget deficit to $1 trillion by fiscal 2011 if he became president.
The economy will need an additional jolt of $500 billion or so of government spending real quick, said Gross in a letter to President Obama posted on Pimcos Web site. It must replace both reduced residential investment and consumption whose decline has placed the U.S. economy near, if not in a recession.
Gross noted that this years budget deficit should be about $500 billion. By doubling that to $1 trillion in three years, that would put the deficit at about 6% of gross domestic product, a mere pittance by Japanese standards. He said its deficit exceeded 10% at its peak a decade ago.
In taking shots at President Bush and the mess Obama would inherit as chief executive, Gross a registered Republican said, Although your campaign slogan says, Yes we can, I have my doubts. While saying increased income taxes under an Obama administration would end an eight-year lease extension on the high life, he called on the presumptive Democratic presidential nominee to drop pretenses of Obamas plans not adding to the budget deficit.
While the Republicans will blame you for years and label you Trillion Dollar Obama in future campaigns, there is in fact not much that you or any other President can do, said Gross. Youve inherited an asset-based economy whose well has been pumped nearly dry with lower and lower interest rates and lender of last resort liquidity provisions that have managed to support Ponzi-style prosperity in recent years.
As a result, What you need now is fiscal spending and lots of it. No ordinary Starbucks will do, Mr. President, you need to step up for a six-pack of Red Bull.
Gross noted that the spending will help push inflation higher still early next decade, with Treasury yields likely to continue rising into a potential second Obama term. Your term will not go down in history as investor friendly, he said. Kevin Kingsbury and Shara Tibken
One of Grampa Dave’s basic financial core advise is to never invest with anyone who is a liberal or a rino like Gross, who supported 0b0z0 and advised him.
” One of Grampa Daves basic financial core advise is to never invest with anyone who is a liberal or a rino like Gross, who supported 0b0z0 and advised him. “
Grampa Dave speaks the truth.
I do wonder what would happen if everything was cut to the bone. And that’s what will have to happen in order to start spending less than we’re taking in. If we want riots, that’s the way to do it. But maybe that’s the only solution.
“Case in point my mother-inlaw, die hard conservative, but hint that she cant go to a doctor for whatever ails her this week and she goes off her rocker.”
You should see how people act in our office when they have a copay or deductible.
God Forbid that they should have to pay some out-of-pocket portion for their own health care.
I wish I could say this diseased mindset is limited to idiotic liberals....
Government spending KILLS private sector jobs.
Whenever somebody discussing politics laments about “the will” to do something, it is always code for raising taxes.
How did you come by this information???
What seems to constantly get lost in the Social security and Medicare issue is that for years they have been drained by people who paid nothing in: anchor babies, illegal aliens, and brand new immigrants along with their extended families. We’re talking hundreds of billions per year. This is an issue neither party has addressed.
I’d remove all freebies from these people before I’d pull it from those who worked all their life and as a condition of employment had a portion of the ‘sweat of their brow’ confiscated and redistributed.
Second, I’d remove the special health care and pension plans from our government and fold into social security and medicare.
Third I’d eliminate is the billions and billions of foreign aid that gets swallowed up in third world hell holes. Fourth defund all those new czarships and the alphabet soup of bureaucracies that are attached to the executive - EPA, HUD, HHS, Dept of Education etc.
The great Yahoo search machine is incredible if you know how to phrase the search ? ! Google is good for maps but not for dirt on liberals.
There are apparently tv videos of with Pimpco’s head Pimp supporting 0b0z0 in 2008.
As you know, I have had problems with Pimpco and Gross for a long time. We sold all of our Pimpco mutual funds at about the same time as the liberal whoreacle of Omaha got out of them. We made good money, but the derivative bs re making 12% or better on Fannie/Freddie bonds making 5-6% got to be scary and too good to be true.
As my Grand Dad told me, “If the investment sounds too good to be true, it probably is bad for most of us!”
We have a winner!!
“What seems to constantly get lost in the Social security and Medicare issue is that for years they have been drained by people who paid nothing in: anchor babies, illegal aliens, and brand new immigrants along with their extended families. Were talking hundreds of billions per year. This is an issue neither party has addressed.
Id remove all freebies from these people before Id pull it from those who worked all their life and as a condition of employment had a portion of the sweat of their brow confiscated and redistributed.”
Decades ago in many of the doctor offices in Gay Frisco and the counties around them, the offices were often loaded with elder Asians with MediCare Cards. These so called MediCare Patients couldn’t speak a word of English.
I got to know one of the Asian MDs, who had a problem with this. He said that newer Asian American Citizens would bring their parents into America. Supposedly pay them money/salaries and contribute to the SS system. As soon as they turned 65, the new comers would go on SS and MediCare.
Since then, millions of Mexican newcomers, Russian, Iranian, Eastern Euror Trash, and from where ever were brought into this country under the same bs. We know of a few English/Americans who did the same with their UK parents.
This bs has gone on for decades with many medical offices, ers and hospital clinics looking and sounding like minature UN enclaves.
Add to this bs, the problem of MediCaid like MediCal putting all new comers on Medicaid and hospital ERS becoming free walkin clinics for the illegals here for the welfare, food stamps, WIC programs and other tax payer bennies.
This so called free care drives the medical costs for the doctors, hospitals, clinics and us.
One of our friends went to the local hospital for an outpatient upper GI Xrays. The bill from the hospital was just under $2000. Medicare paid just under $100 with no payment due from the patient. So American citizens with insurance or minimal insurance get the $2000 bill. Many hospitals are now requiring the legal payers to use a credit card for payment for Out patient procedures and same day surgery or to put up cash before the procedure. Of course this doesn’t apply to the Illegals milking our health care system.
Illegal immigrants, and white collar unions(caused by then Gov. Brown in the late 1970’s) have all but destroyed California.
The way they keep sucking up benefits is by hyphenating themselves---forming "voting blocs"---they then get vote crazed politicians on all fours sucking up for votes and campaign donations.
THIS IS AN OUTRAGE: Recent news report say L/E closed down three California upscale townhouses operating as a maternity center for Chinese mothers---the mothers paid $35,000 to stay there. Their families back home paid their fare so they could have their babies born in America; to have the children automatically gain US citizenship.
You have to ask: why would they fork over thousands of dollars to give birth here?
B/c it's an investment for the lucrative future--- when the US tax dollars start rolling in. Those "anchor babies" give the mother, father, and extended family, free entry into the US---- they then get on the US gravy train, and suck-up benefits from here to eternity.
Russian emigres are THE WORST---they come here whining about "asylum" ---- a well-used scam to get on SS (which has a special category for "asylum seekers"). They never paid a dime into the system. When Congress tried to turnoff the SS faucet, one of the scumbags actually sued. The new Ruskis also get job set asides (jobs taken from born Americans), welfare, food stamps, etc, etc, etc. These are not "impoverished" people. They are professionals. eternally riding the gravy train.
Some of them DO work--- ripping off Medicare.
NY POST---July 2010---EXCERPT A Brooklyn medical office used a Soviet-era propaganda poster to silence Russian immigrants about getting kickbacks for letting doctors submit thousands of bogus Medicare claims in their names....... the poster hung in the "kickback room" of the medical office where Russian immigrants lined up for illegal payoffs. Also busted were Medicare "mills" elsewhere in Brooklyn, and in Miami, Detroit, Houston and Baton Rouge, La.
By Paul Martinka
Russian poster shushed immigrant partners in Medicare fraud. Insert pic is
a Russian immigrant not too happy about being nailed---getting a fee for allowing
doctors to submit her Medicare card for 3,774 medical services over six years.
The way I figure it we can have riots now while saving the economy and therefore the nation or we can wait until the economy and nation are destroyed then have riots. I’m in favor of the former.
So when the riots start, those are the guys I'm looking for. To say something nice in Russian like, 'Let's Have Some Vodka' :-)
Препятствуйте нам выпить некоторую водочку совместно
The rest can pound sand, and better stay out of range, especially our 'visitors from the south'. AND, 'Holders' People'.
(1) The Spetsnaz training is so tough they expect to die during it -- and many do. And they can Kill with anything they can get their hands on.