Is this a sign of the Apocalypse?
I speak, of course, to the budget deficit and Washington’s inability to recognize the intractable: 75% of the budget is non-discretionary and entitlement based. Without attacking entitlements – Medicare, Medicaid and Social Security – we are smelling $1 trillion deficits as far as the nose can sniff. Once dominated by defense spending, these three categories now account for 44% of total Federal spending and are steadily rising. As Chart 1 points out, after defense and interest payments on the national debt are excluded, remaining discretionary expenses for education, infrastructure, agriculture and housing constitute at most 25% of the 2011 fiscal year federal spending budget of $4 trillion. You could eliminate it all and still wind up with a deficit of nearly $700 billion! So come on you stinkers; enough of the Pepé Le Pew romance and promises. Entitlement spending is where the money is and you need to reform it.
And whadayano–6eorge searches for cheap segue link–Warren Buffett is bearish, too
Pimco “has been selling Treasuries because they have little value within the context of a $75 trillion total debt burden,” Gross wrote in the report published on Newport Beach, California-based company’s website. Congress “must make ‘debt’ a four-letter word.”
The comment echoes Warren Buffett, the billionaire investor who recommended avoiding long-term fixed-income bets in U.S. dollars because the currency’s purchasing power will drop.
Which can be more colorfully titled as WARREN BUFFETT: Stay The Hell Away From Long-Term Bonds
According to Bloomberg, the Berkshire chief said in India yesterday:
I would recommend against buying long-term fixed-dollar investments. If you ask me if the U.S. dollar is going to hold its purchasing power fully at the level of 2011, 5 years, 10 years or 20 years from now, I would tell you it will not1.
I would much rather own businesses. It’s very easy to take away the value of fixed-dollar investments.
And finally, JP Morgan’s Chairman and CEO Jamie Dimon on American competitiveness
“If America adopts a lot of things very different than the rest of the world,” U.S. competitiveness will be damaged, Dimon told investors at a Feb. 15 meeting at JPMorgan’s New York headquarters. JPMorgan’s chairman and CEO said forcing banks to spin off some derivatives business is “absurd” and other changes in last year’s Dodd-Frank Act are a “terrible shame.”
Is this agreement a sign of the Apocalypse? Yes, the financial one it took to get three private-citizen Democrats to speak truthfully.