The American Spectator

Bill Gross, the Managing Director of PIMCO, the world’s largest bond investment manager, has just published his latest monthly letter. It’s a great and sobering (but not yet panicky) read:

http://www.pimco.com/EN/Insights/Pages/Damages.aspx

Perhaps the most memorable line: “The U.S., in fact, is a serial [debt] offender, an addict whose habit extends beyond weed or cocaine and who frequently pleasures itself with budgetary crystal meth.”

He adds that the US balance sheet “is in flames and that its fire department is apparently asleep at the station house” while getting into a discussion of an 11% “fiscal gap” which will require the combination of spending reductions and revenue increases of over a trillion and a half dollars per year and points out the sobering political reality that the Bowles-Simpson plan which was politically impossible to sell was aiming for only a quarter of the amount needed to eliminate our budget deficit.

Gross’ discussion of the Ring of Fire is well worth reading for anyone who is tempted to believe Barack Obama’s casual dismissal of the US federal debt and deficit as a major or short-term problem: