Thank you to Shocked Investor for the heads up on the publication of Bill Gross’s new Economic Outlook for 2010.
Bill Gross is managing director of Pimco ‘a leading global investment management firm with more than 1,200 employees in offices in Newport Beach, New York, Amsterdam, Singapore, Tokyo, London, Sydney, Munich, Toronto and Hong Kong.’
This is the same Pimco that recently announced it would be a net seller of UK Government bonds this year and that it would reduce its holdings of American treasury debt (see this post at The Market Ticker).
Shocked Investor comments ‘You’d think something is about to give.’ Since being so shocked, he’s so cool about everything now.
Here is the beginning of Bill Gross’s Economic Outlook 2010 (my bold letters):
Quixotic journeys often make for great literature, but by definition are rarely productive. I am, after all, referring to windmills here - not their 21st century creation, but their 17th century chasing. Futility, not productivity, was the ultimate fate of Cervantes' man from La Mancha. So it is with hesitation, although quixotic obsession, that I plunge headlong into a discussion of American politics, healthcare legislation, resultant budget deficits and - finally - their potential effect on financial markets. There will be windmills aplenty in the next few pages and not much good can come of these opinions or my tilting in their direction. Still, I mount my steed, lance in hand, and ride forward.
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, defence, 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.
Read the full report here.