Bill Gross, Founder and Co - Chief Investment Officer of PIMCO, one of the world's leading investment management firms that describes itself as a global investment solutions provider, writes a monthly Investment Outlook that is published on the PIMCO web site, www.pimco.com.  Mr. Gross is one of the world's premier investment managers.  His understanding of the world's financial markets give him expertise that is unmatched by very few people in the world. 

The April Investment Outlook is now available at www.pimco.com.  The title of the April Outlook is "Skunked".  Mr. Gross explains in relatively simple terms the looming financial disaster that the United States federal government has created over decades.  Everyone that cares about the future of the United States of American should read "Skunked".  Mr. Gross concludes "Skunked" with the following comments.

"If I were sitting before Congress – at a safe olfactory distance – and giving testimony on our current debt crisis, I would pithily say something like this:

I sit before you as a representative of a $1.2 trillion money manager, historically bond oriented, that has been selling Treasuries because they have little value within the context of a $75 trillion total debt burden.

Unless entitlements are substantially reformed, I am confident that this country will default on its debt; not in conventional ways, but by picking the pocket of savers via a combination of less observable, yet historically verifiable policies – inflation, currency devaluation and low to negative real interest rates. Our clients, who represent unions, cities, U.S. and global pension funds, foundations, as well as Main Street citizens, do not want to be shortchanged or have their pockets picked. It is incumbent, therefore, in order to preserve the integrity of the U.S. Treasury market along with its favorable global interest rates, and to promote a stable U.S. economy, that entitlement spending be reduced, and that future liabilities be addressed in terms of healthcare and Social Security cost containment. You must attack entitlements and make ‘debt’ a four-letter word.”

I hope our political leaders will listen to Mr. Gross.  His expertise in these matters far exceeds anyone in the White House or the Congress.  If you wonder why the Tea Party movement has gained momentum in the past few years, Mr. Gross provides the analysis that is a "gut feel" for regular folks from all over the country.

President Obama, are you listening? Listen to Bill Gross!

TPM

The 2011 budget, 2012 budget and debt ceiling debate is beginning to heat up in the United States Congress as the deadlines for dealing with these critical issues approaches.  Unfortunately, the Obama administration and Senate Majority Leader Harry Reid appear unwilling to fundamentally change the financial course of our nation.  They are refusing to address the issues they have been elected to address.  Democratic leaders have been caught on tape explaining their plan to blame the Republicans for shutting down the US government.  The Republicans have meet their obligations in the House of Representatives.  The House spending bill to keep the government running has passed and been sent to the Senate for action.

Why can't the Democrats step up to the task at hand and provide effective leadership for our nation?  Why do they run and hide from financial truths?  I don't have the answers to my questions.  Maybe the answer is simple.  The people that were elected simply can't lead the nation or don't want to lead the nation.  If this is the case they must be removed from office or removed from leadership positions as soon as possible.

TPM

I have just added a new article titled Leadership Failures of Barack Obama, http://www.thepurplemuse.com/id45.html,  to the web site. 

What do you think about our President's leadership qualities?  Unfortunately, I don't think much of President Obama's leadership ability.  Read my article and you will undertand why I think our President is a failure as a leader.  Collectively, the US voters are the Board of Directors for the President but we only meet every four years to decide who we want to lead us.  Hopefully, we can find a replacement that can step up to the challenges facing our nation before it is too late.

TPM

Check out my updated article, "Spin, Lies, Conspiracy and Truth", http://www.thepurplemuse.com/id33.html.  Some Bible stories are legitimate history.  How do we separate fact from fiction or spin from truth? Is the original Ark of the Covenant in Ethiopia?  Did Graham Hancock get close to the truth in his book "The Sign and the Seal". We need to keep digging, keep investigating, and keep our minds open to new information. 

TPM

David R. Gergen, CNN Senior Political Analyst and adviser to US Presidents,  asked the following question recently on FaceBook.  "If you were President Obama, what four situations would you focus on tomorrow?"

My contribution to the list of comments was the following:

1. Restore government fiscal responsibility by slashing spending and simplifying the tax code while eliminating special interest tax breaks.

2. Develop national energy program focused on developing US sourced oil, natural gas, solar electric generation, wind power and safe nuclear (which can be done in certain areas of the country) with coal based electric generation reduced over time. US must eliminate oil exports from all nations other than Canada and Mexico. There is no such thing as clean coal. Nukes preferred over coal.

3. Restructure US foreign policy to eliminate US role as world's police force. Withdraw most overseas deployed US military. Maintain strong defensive military capability.

4. Implement a fair immigration, naturalization program that substantially reduces illegal immigration. Fully enforce US immigration laws.

This is a great question by Mr. Gergen.  What "situations" would be on your list?

TPM

This morning I walked out of my garage and picked up my Washington Post in my driveway.  As I pulled the newspaper out of its protective plastic cover I noticed the headline on the Business section which was on top. The headline was "Another Gold Rush".  In bold type below the fold I read "A D.C. lawyer and her associates secured more than $500M in federal contracts intended to benefit Alaska native corporation. Less than one percent made it back to Alaska."  The article is also avaiable online at http://www.washingtonpost.com/wp-dyn/content/article/2011/03/12/AR2011031204264.html.

The article highlights a fundamental problem with many well intended government programs.  People that become expert on how to extract money out of federal programs for their own benefit are permitted to defeat the fundamental intent of the programs.  The federal employees that are paid to monitor the contracts and the companies that are involved don't do their jobs properly.  The taxpayers money is wasted through what amounts to legal or quasi-legal theft and the federal employees don't pay a price for their incompetence.

The only way to combat the types of abuse highlighted in the Washington Post article is to simply reduce the amount of money the federal government spends.   We need to eliminate agencies, departments, programs and people.  There is no way to completely eliminate this type of abuse.  People will always find ways to take advantage of any organization or system that controls huge amounts of money.  However, we must take action to minimize it.  You wonder why we have a huge budget deficit and national debt.  This is just one "small" example.  

The House and Senate are now arguing over small budget cuts for the current fiscal year.  Congress and the Obama Administration need to finish their work and get on with developing the massive spending cuts that need to put in place for fiscal year 2012 and beyond.  Don't even talk to the American people about tax increases until an axe is taken to the spending side of the budget.

Get moving Mr. President.  Get your act together Congress.  Time is wasting.  Get your ass in gear and get the job done.

TPM

The financial debacle of the US federal government, the riotous behavior at the Wisconsin state capitol, and the screaming mass of people that are paid directly or indirectly through federal government programs and desparately trying to protect their cushy jobs and benefits are indicative of a fundamental problem within the US democracy.  If people being paid directly or indirectly by the government obtain too much influence in the political process they will do everything in their power to protect themselves and their colleagues ride on the government payroll.  

Private sector people that must compete in the world economy have allowed the government class to gain control of the allocation of financial resources within our economy.  The government class is allocating an inappropriate share of the national income their unproductive activity creating massive economic imbalances to the long term detriment of everyone.  In other words the people drinking from the public trough are killing our economy by making it less and less competitive compared to the rest of the world.

The only way to fix the problem is to reduce the number of public sector employees, reduce the cost of public sector employees that remain and reduce the number of people whose income is dependent on government sponsored programs.  In other words, the US must significantly cut government spending at all levels so the economy can regain a proper balance between the public and private sector.  The US economy is being killed by far too much government overhead.  Every businessman knows that too much overhead will kill a company.  It should be obvious by now that too much government overhead is killing our nation.

Get out the financial axe and start slashing government budgets at all levels The US simply can't afford the current cost of its government.

TPM

We just returned home from a one week cruise on Royal Caribbean's Allure of the Seas, the sister ship to Oasis of the Seas.  Allure of the Seas is magnificent and it is now the world's largest cruise ship, by two inches.  Our only problem with the cruise was that it ended.  Ah, it would have been very nice to keep on going for another week. But alas we had to come home today.

We had a great cruise with two ports of call in Mexico and Royal Caribbean's private area on Haiti called Labadee.  It was tough duty relaxing in the sun and in the hot tubs.

When we cruised on Oasis of the Seas in April 2010, we observed Royal Caribbean dealing with a few technical problems that came with a new class of ships.   We experienced no similar problems on Allure of the Seas.  While the two Oasis class ships are not perfect, they are a marvel none the less.  The combination of marine engineering, information technology, art and great service by the crew is unprecedented from my perspective.   The Royal Caribbean team is top notch and really on its game. 

We wish Captain Johnny and his crew good luck as Allure of the Seas sails on without us. 

TPM