Dr. Weeks’ Comment: Like lemmings, we move forward. Does the emperor have any clothes at all? The recent unemployment numbers are inexcusable – Americans are starving while Wall Street execs who failed, get bonuses and are rescued. Now a big player, Bill Gross co-manager of worlds largest bond fund, is sharing his disgust.
Bill Gross, co–chief investment officer at Pacific Investment Management Co.
January 8, 2010 — The anger enveloping the nation (and I’m talking about the US) is extraordinary. The fact is that most Americans realize (or they’re beginning to) that they have been screwed over by the Obama administration with the help of his Wall Street “advisers,” the Fed and the Treasury. While the big players of Wall Street have been bailed out by multi-billions in so-called tax-payers money. At the same time, the poor devil on Main Street is looking for a job and a way to avoid his house being foreclosed. His savings were decimated by the bear market leg of 2007-08, and he’s mad as hell when he reads about the bonuses those unprincipled, greedy bankers are pulling in.
I was frankly surprised when I read PIMCO’s brilliant Bill Gross lowering the boom on Wall Street and the Obama administration. Gross is a tough-minded bond man (co-manager of the world’s largest bond fund), and he’s clearly mad as hell, and he has the real guts to write about it, as you can see via the excerpts below from his latest report.
“Question: What has become of the American nation? Conceived with the vision of liberty and justice for all, we have descended in the clutches of corporate and other special interests to a second world state defined by K Street instead of Independence Square. Our government doesn’t work anymore, or perhaps more accurately, when it does, it works for special interests and not the American people. Washington consistently stoops to legislate 10,000-page perversions of healthcare, regulatory reform, defense, and budgetary mandates overflowing with earmarks that serve a monied minority as opposed to an all-too-silent majority. You don’t have to be Don Quixote to believe that legislators – and Presidents – often do not work for the benefit of their constituents: A recent NBC News/Wall Street Journal poll reported that over 65% of Americans trust their government to do the right thing “only some of the time” and a stunning 19% said “never.” What most politicians apparently are working for is to perpetuate their power – first via district gerrymandering, and then second by around-the-clock campaigning financed by special interest groups. If, by chance, they’re ever voted out of office, they have a home just down the street – at K Street – with six-figure incomes as a starting wage.
“What amazes me most of all is that politicians can be bought so cheaply. Public records show that combined labor, insurance, big pharma and related corporate interests spent just under $500 million last year on healthcare lobbying (not much of which went to politicians) for what is likely to be a $50-100 billion annual return. The fact is that American citizens have never been as divorced from their representatives – and if that description fits the Democratic Congress now in control – then it applies to Republicans as well – past and present. So you watch Fox, or is it MSNBC? O’Reilly or Olbermann? It doesn’t matter. You’re just being conned into rooting for a team that basically runs the same plays called by look-alike coaches on different sidelines. A “ballot box” pox on all their houses – Senators, Representatives and Presidents alike. There has been no change, there will be no change, until we the American people decide to publicly finance all national and local elections and ban the writing of even a $1 check for our favorite candidates.
“If 2008 was the year of financial crisis and 2009 the year of healing via monetary and fiscal stimulus packages, then 2010 appears likely to be the year of “exit strategies,” during which investors should consider economic fundamentals and asset markets that will soon be priced in a world less dominated by the government sector. If, in 2009, PIMCO recommended shaking hands with the government, we now ponder “which” government, and caution that the days of carefree check writing leading to debt issuance without limit or interest rate consequences may be numbered for all countries.”
And where is President Obama in all this? His idea is to spend, spend and then spend more. Obama’s strategy is to “spread the money around and they will spend.” But where’s the money coming from? No problem, tax the rich, and if that doesn’t bring in enough money, then tax the bastards again. It’s all so simple when you think about it. But what if they call you “a socialist? Fine, thinks Obama, learn to accept compliments gracefully.