When Bill Gross says he has amnesia, maybe it’s time to panic. He is the head of the world’s largest bond shop, after all, and could easily miss a decimal point.
His monthly investment outlook for October is typical Gross, the founder of PIMCO, a meandering mix of personal anecdotes and professional numbers that eventually (somehow) get to a point. This month it’s all about doing something about taxes and sending before it’s too late.
“I have an amnesia of sorts. I remember almost nothing of my distant past–a condition which at the brink of my 69th year is neither fatal nor debilitating, but which leaves me anchorless without a direction home,” he writes. “Actually, I do recall some things, but they are hazy almost fairytale fantasies, filled with a lack of detail and usually bereft of emotional connections. I recall nothing specific of what parents, teachers or mentors said; no piece of advice; no life’s lessons. I’m sure there must have been some–I just can’t remember them. My life, therefore, reads like a storybook filled with innumerable déjà vu chapters, but ones which I can’t recall having read.”
Comparing his damaged long-term memory to the damage of the debt peril in which the country finds itself, he concedes, “Armageddon is not around the corner. I don’t believe in the imminent demise of the U.S. economy and its financial markets. But I’m afraid for them.”
Apparently so are many others, among them the International Monetary Fund, the Congressional Budget Office and the Bank of International Settlements. These “authoritative and mainly non-political organizations “describe the financial balance sheets and prospective budgets of a plethora of developed and developing nations.
“What they’re saying is that when it comes to debt and to the prospects for future debt, the U.S. is no ‘clean dirty shirt,’ ” before colorfully continuing “The U.S., in fact, is a serial offender, an addict whose habit extends beyond weed or cocaine and who frequently pleasures itself with budgetary crystal meth. Uncle Sam’s habit, say these respected agencies, will be a hard (and dangerous) one to break.”