another site
George Carlin explains why he doesn’t complain about politicians… “this is all we have to offer, garbage in, garbage out” Maybe, he chides, it’s not the politicians, “the public sucks, f#$k hope!”
Source: Mike Krieger’s Liberty Blitzkrieg blog
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Republicans have won majorities in the House and Senate. Results in some states have not yet been finalized, but Republican gains appear to be somewhat larger than most observers expected.
KEY POINTS:
1. Republicans have won a net seven seats in the Senate, giving them a majority of at least 52 seats. As of this writing, final results in Alaska, Louisiana, and Virginia have not yet been determined, but preliminary results suggest that Republicans will win another two seats in those states, for a total gain of nine seats. If so, this would lead to a final Senate composition of 54 Republicans and 46 Democrats (counting two independent senators who currently caucus with Democrats). Results in Alaska and Virginia should be settled soon, while the Louisiana contest will go to a runoff election to be held December 6.
2. Results in the House are not yet final but preliminary results show slightly greater Republican gains than many observers expected. Republicans currently hold 234 House seats and have won 12 additional seats so far, with results in several contests not yet finalized. Preliminary results in those other races indicate Republicans could end up with a roughly 15 seat overall gain, or just under 250 House seats.
3. Under a Republican congressional majority in both chambers, our expectation has been that the legislative agenda will be more active in 2015 than it has been over the last year, with a possibility of action on corporate tax reform and infrastructure funding, among other issues. We also see some risk of renewed uncertainty ahead of fiscal deadlines, at least until it becomes clear how issues such as the debt limit (likely necessary by October if not earlier) will be addressed.
4. The slightly larger than expected Republican gains should give Republicans more flexibility to get legislation to the President’s desk, for two reasons:
Source: Goldman Sachs
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It’s hard to avoid the conclusion that last
night’s midterm election was a referendum on President Obama.
Republicans in nearly every close race made opposition to President
Obama issue number one. Exit poll and pre-election surveys make it
clear that voters were
dissatisfied with the economy and the president’s job
performance, and they cast their votes in
protest of the president.
President Obama wasn’t on the ballot, of course, but as he
himself insisted last month, his policies were. Many of the
incumbent Democrats up for a vote had voted heavily in support of
the president’s agenda. Democrats struggled mightily to distance
themselves from Obama, but they could not escape his gravity.
To put it another way: Voters didn’t like Obama—and they took it
out on his fellow Democrats.
That has to be worrying for Hillary Clinton. Because unless
there’s a dramatic change in voter sentiments about the president,
the 2016 Democratic presidential nominee is likely to face similar
headwinds.
Clinton has not yet announced that she is running for the
Democratic nomination, but she is widely expected to run, and if
and when she does, she will be the immediate frontrunner. But
unless the political ground shifts in a way that makes the
presidential race quite favorable to Democrats, Clinton, who served
as Obama’s secretary of state, will face the same Obama-related
challenges that many Democrats faced this round.
Her history with the president and the Democratic party means
she won’t be able to run far away from the president in a way that
is plausible. And yet she also won’t be able to run aggressively on
his achievements and legacy either.
Knowing Clinton, she’ll likely attempt a tailored version of the
strategy that Democrats in close races adopted this time
around—positioning herself as separate from the president but not
actively opposed to him. She’ll highlight the parts of policies
that are widely liked, but acknowledge that many need to be fixed,
tweaked, or updated—while providing as few specifics as possible
about what those specifics should be. Indeed, to some extent, this
is already the approach that Clinton has taken, vaguely moving away
from Obama in ways designed to cause as little real friction as
possible. She’ll be neither with Obama nor against him, emphasizing
distance but not disagreement.
That awkward, fence-straddling approach led to some
slightly ridiculous moments, and ultimately failed to work for
Democrats in this year’s midterm. It’s not likely to work for
Clinton (or any other Democratic nominee) in 2016 either.
Yes, President Obama’s approval could change, but that would
probably require the White House to change first. Don’t expect that
to happen. Despite the GOP tide, the administration has
already dropped hints that it won’t be making major adjustments
to its approach.
In two years, of course, President Obama’s second term will be
ending, and Democrats already seem to be consoling themselves that
he won’t be a drag on the next election. His time will be over, and
voters won’t punish Democrats for his presidency. Tell that to John
McCain. A two-term president can still hurt a party even on the way
out, as Bush did in 2008. And if last night’s anti-Obama Republican
wave is any indication, the current president could hurt Democrats
in the next election too.
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Authored by Kevin O'Brien and Gabor Steingart, originally posted at Handelsblatt,
E.U. May Crack Over Ukraine, Soros Warns
The legendary Hungarian-American investor, George Soros, told Handelsblatt that the European Union and euro currency zone could unravel if member countries can't agree on a unified response to Russia's aggression in Ukraine.
The European Union and the euro could founder if its members don’t stand together against Russia, George Soros said Tuesday in Düsseldorf. Source: Frank Beer for Handelsblatt George Soros, one of the world’s richest men and a tireless defender of Central European democracy, warned that the European Union, a mainstay of post-war stability, could dissolve and unravel if the 28-country bloc can’t agree on a common response to Russia’s aggression in the Ukraine.
Speaking on Tuesday in Düsseldorf at a dinner sponsored by Handelsblatt, Mr. Soros, an 84-year-old Hungarian-American who survived the Holocaust and then fled the Soviets, said the future of the European alliance of nations stretching from Ireland to Estonia could hang in the balance.
Russia this year seized the Crimean peninsula from the Ukraine and is now arming and supporting a separatist movement in the eastern part of the country, an action which has been met with economic sanctions from the United States and the European Union.
The sanctions have hurt Russian and European trade, and have led to a slowdown of economic growth on the Continent. In Germany, some business and political leaders are now calling on political leaders to abandon the E.U. sanctions.
In other parts of Europe, the call is growing louder for a softer line with Russia.
“I think the real question is whether the European Union will break up over Russia," Mr. Soros told 400 people at a dinner held in a Düsseldorf museum by the German financial publishing group. “The E.U. is under threat from Russia… The E.U. is broken, and it is not functioning."
Mr. Soros, a legendary investor and hedge fund manager whom Forbes estimates is worth $24 billion, warned of an E.U. breakup and a breakup of the euro single currency zone, which includes 18 E.U. countries, including Germany.
In an interview with Gabor Steingart, the Handelsblatt publisher and the son of a Hungarian emigrant to Germany, Mr. Soros urged Europeans to stand together against Russia, which he said is bent on reasserting its military hegemony over parts of the Continent.
“Wake up Europe," said Mr. Soros, who had just returned from a visit to Ukraine. “There is now an alternative to the European Union, a different way to run a state through use of force. I’m talking about (Vladimir) Putin’s Russia. The reason he is making headway is because of the failure of the E.U."
The son of Jewish parents in Budapest, Mr. Soros survived the Nazi occupation and left the Hungarian capital and Soviet control in 1947 as a 17-year-old for Britain, where he attended the London School of Economics before emigrating to the United States.
Western economic sanctions against Russia, which are limiting the ability of Russian businesses to obtain financing on the global market, are a necessary evil, Mr. Soros said. He lauded the German chancellor, Angela Merkel, for supporting the E.U. penalties.
“I think Angela Merkel has proven herself to be a true European stateswoman in recognizing the danger that Putin represents," Mr. Soros said.
The sanctions, however, are helping Russian hardliners close to President Putin consolidate power and influence in the Kremlin, which in turn is sharpening and stiffening Russia’s response to Western penalties, he said. Some oligarchs unhappy with the worsening situation are sending their families abroad and preparing for their own exits, he said.
In many cases, though, any assets they leave behind are being taken over by Russian hardliners, which is worsening the spiral of recrimination with the West, Mr. Soros said.
“The sanctions are an evil but they are a necessary evil and are having the very bad effect in Russia of actively strengthening Putin’s role," Mr. Soros said. “There is taking place a concentration of his closest allies." Sentiment in Germany is split over E.U. sanctions against Russia.
In a new book released this month, the former German chancellor, Helmut Kohl, who oversaw his country’s reunification 25 years ago and negotiated the withdrawal of Russian forces, takes aim at Ms. Merkel and European leaders for policies he said are isolating Russia.
Mr. Soros, however, said Europe needed to redouble its hard line against Russia, and said that U.S. President Barack Obama’s failure to take a strong immediate response to Russia’s seizure of Ukraine territory only emboldened Vladimir Putin, who could conceivably transfer his designs from Ukraine to the Baltic countries, which are now E.U. members.
"Freedom sounds like a free good, but you have to be ready to defend it," Mr. Soros said. “If you don’t put up resistance, it will become too hot to handle."
Pro-European Ukrainians are “fighting to defend Europe and the Europeans don’t realize it,’’ Mr. Soros said. Moving on to economic issues, Mr. Soros faulted Germany for doing too little to restore euro zone stability. He said the inflation-fighting mandate of the European Central Bank, which is based in Frankfurt, is no longer appropriate when deflation, not inflation, is the real threat.
The ECB is controlled by Germany, the zone’s largest economy and toughest enforcer of austerity demands on weaker euro countries such as Greece, Spain, Portugal and Italy, Mr. Soros said. Referring to the ECB president, Mario Draghi, Mr. Soros said: “Draghi can do whatever it takes (to save the euro) as long as he has the support of Angela Merkel," Mr. Soros said. “The ECB is independent as long as it has support from Germany."
German demands for austerity are wrong-headed, he said, and only serve to impede the euro zone’s recovery.
"The policy of austerity is inappropriate to the current conditions," Mr. Soros said. "We are in a situation of deflation and the policies are directed at inflation."
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Yesterday the number of states that have approved marijuana
legalization
doubled, and they were joined by the nation’s capital, where
voters overwhelmingly
rejected pot prohibition. Even in Florida, where a medical
marijuana initiative
fell three points short of the supermajority needed to approve
a constitutional amendment, 57 percent of voters agreed that
patients should be allowed to use cannabis for symptom relief.
Meanwhile, voters in Guam
approved medical marijuana, making the Western Pacific island
the first U.S. territory to do so. Drug policy reformers were
thrilled by the results, which exceeded expectations.
Prohibitionists were less delighted. Here is a roundup of
reactions.
ON GUAM
Tom Angell, chairman of
Marijuana
Majority: The marijuana majority
is a truly global phenomenon. People all across the world are ready
to move beyond failed prohibition laws, especially when seriously
ill patients are criminalized just for following their doctors’
recommendations. With these election results, U.S. territories
stretching from Guam—where America’s day begins near the
International Date Line—to Hawaii and Alaska have sensible laws
that let patients use marijuana without fear of arrest.
Ethan Nadelmann, executive director of the Drug Policy
Alliance: Guam is quite conservative politically,
and home to a significant U.S. military presence, so this
resounding victory is a confirmation of medical marijuana’s broad
support across the political spectrum.
ON D.C.
Angell: With marijuana legal in the
federal government’s backyard, it’s going to be increasingly
difficult for national politicians to continue ignoring the growing
majority of voters who want to end prohibition. I’ve been saying
for a while that 2016 presidential candidates need to start
courting the cannabis constituency, and now the road to the White
House quite literally travels through legal marijuana
territory.
Bill Piper, DPA’s director of national
affairs: This was the first legalization campaign in
which the racial disproportionality of marijuana enforcement played
a major role. Initiative 71 sets the stage for the D.C. Council to
create a new model for legalizing marijuana—one that places racial
justice front and center.
Neill Franklin, executive director of Law Enforcement Against
Prohibition: Each Congressperson must choose how
he or she wants to be remembered in history: as someone who
respected the people’s wishes and worked to end one of the most
pernicious problems of the 21st Century, or as an anachronism,
like those prohibitionists who refused to see the writing on the
wall in the 1930s.
ON OREGON
Angell: It’s clear that Colorado and Washington
voting to legalize in 2012 was no anomaly. The trend is clear:
Marijuana prohibition is coming to an end. As 2016 approaches, we
can expect to see many more ambitious national politicians finally
trying to win support from the cannabis constituency instead of
ignoring and criminalizing us.
Nadelmann: Oregon proved that Colorado and
Washington were no flukes….It’s always an uphill battle to win a
marijuana legalization initiative in a year like this, when young
people are so much less likely to vote, which makes today’s victory
all the sweeter. The pace of reform is accelerating, other states
are sure to follow, and even Congress is poised to wake from its
slumber.
ON ALASKA
Angell: Now that it’s been shown that
putting marijuana legalization on the ballot can succeed even in
midterms, we can expect to see a huge surge of additional states
voting to end prohibition during the 2016 presidential election.
And because the issue has been proven to be mainstream as far as
voters are concerned, we may even see lawmakers in several states
jumping ahead to legalize marijuana legislatively in the
meantime.”
Chris Rempert, political director of
Alaska’s legalization
campaign: People are seeing through the fear
mongering and misinformation that have been used to keep marijuana
illegal for so many years. One of our campaign’s primary messages
was that marijuana is less harmful than alcohol, and that adults
should not be punished for making the safer choice.
ON FLORIDA
Angell: Tonight’s result does show that
a clear majority of voters in the sunshine state support a new
direction. We didn’t get the 60% needed to pass medical marijuana
as a constitutional amendment, but patients and their supporters
will keep pushing until the law reflects what most voters want. The
campaign this year faced several key challenges, including that it
took place during a midterm election in which turnout dynamics
don’t favor marijuana reform. Next time medical marijuana is on the
ballot, organizers should put patients and medical professionals at
the forefront of the campaign rather than relying on a well-meaning
but much less sympathetic political donor as the chief
spokesperson.
John Morgan, leader of the medical marijuana
campaign: We may not have passed Amendment 2 tonight,
but make no mistake, tonight was a victory in the fight for medical
marijuana in Florida. Our next governor will take the oath of
office having won less than a majority of Floridians’ votes. The
idea that marijuana is medicine and that those suffering and in
pain should not be made criminals, received a larger share of the
vote than the winner of the last 6 gubernatorial elections…and
every presidential campaign in Florida for decades.
Calvina Fay, executive director of the Drug-Free America
Foundation: The people of Florida strongly and
wisely rejected efforts to make Florida the next front in the push
to legalize marijuana nationwide….By rejecting this misguided
amendment, they chose to safeguard our communities and ensure a
safer and more prosperous future.
ON THE OVERALL RESULTS
Rob Kampia, executive director of the Marijuana Policy
Project: The results are in, and marijuana
prohibition is on its way out….The folks trying to keep marijuana
illegal are relying on the same scare tactics today that they have
relied on for decades, but voters just aren’t falling for it
anymore. The results are particularly encouraging since voter
turnout during a midterm election is typically smaller, older, and
more conservative. Clearly, support for ending marijuana
prohibition spans the political and ideological spectrums.
Paul Armentano, deputy director of NORML: The majority of voters
in these states, like a majority of voters nationwide, agree that a
pragmatic regulatory framework that allows for the legal, licensed
commercial production and retail sale of cannabis to adults best
reduces the risks associated with the plant’s use or potential
abuse.
Patrick Kennedy, co-founder of the anti-pot group
Project
SAM: Even though we did not do as well as we
wanted to, these slim margins of victory show that we are beginning
to slow the legalization freight train down. This has been a David
and Goliath battle.
Kevin Sabet, president of Project
SAM: This was not the complete slam-dunk the
legalization groups expected. Alaska barely voted to legalize, and
several cities [in Colorado] rejected marijuana retail stores
outright. We are confident the more people know the truth about
marijuana and the Big Tobacco-like marijuana industry, the more
opposition to marijuana legalization will continue to grow. We will
redouble our efforts to educate the public about the harms of
legalization.
U.S. Department of Justice (via Free
Beacon reporter
C.J. Ciaramella): When we developed our
department priorities over a year ago, we intended to set out a
consistent enforcement approach that would be applicable across the
country. As our Aug. 29, 2013, guidance memorandum laid out, the
department’s enforcement resources will continue to be aimed at the
most significant threats to our communities. This approach relies
on jurisdictions instituting strict regulatory regimes to
adequately protect public safety.
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Some local victories, ballot-access guarantees, and some more
statewide numbers of encouraging size, from the Libertarian Party’s
regularly-updated midterm
election news page:
John Monds, running for the Public Service Commission in
Georgia, is currently at 31.6%, with 707,328 votes.
Several victories in Louisiana: William McBride was
elected to the town council of Washington in St. Landry Parish.
Henry Herford was elected as a constable in Franklin Parish. Justin
Bonnette was elected as a Justice of the Peace in Vernon Parish.
Chad Perry will be in a runoff for Justice of the Peace in
Calcasieu Parish……Michael Knebel, running for Treasurer of Nebraska, is
currently at 5.3%. If he stays over 5%, the LP will retain ballot
access in Nebraska.Several Libertarians running for state house in Washington are
getting over 30% of the vote. David A. Steenson is at 32.4%, Elijah
Olson is at 31.5%, and Tim Turner is at 31.7%……Bobby Tullis was elected as the mayor of Mineral Springs,
Arkansas (nonpartisan race).…..Andy Craig, running for secretary of state in Wisconsin, is
currently at 2.5%. The LP needs 1% for any statewide office to
retain ballot access.…..Randall Lord, running for U.S. House District 4 in
Louisiana, is at 28.4% (38% of precincts reporting). In 2012, he
got 24.7% for the same office.…..Karl Tatgenhorst, running for secretary of state in
Indiana, is currently at 3.4%. The LP needs 2% for secretary of
state to retain ballot access.Libertarians in Arkansas have already elected
two candidates today. Jacob Faught is running unopposed
in his race for Benton County Township 5 Constable (a partisan
race). Casey D. Copeland is running unopposed for Prairie
Grove Alderman (a non-partisan race). This will be his third win in
a row.
And in addition to the
gubernatorial candidates I noted last night, Idaho’s John Bujak
is also pulling impresssive-for-L.P. numbers,
at 4.07 percent.
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Candidates who have taken on the unions fared
well in last night’s elections. Initiatives related to reforming
their pensions did not, however, do so well.
Rick Snyder of Michigan and Scott Walker of Wisconsin, both
Republican, fended off challengers to earn additional terms as
governors. Both have earned the ire of unions;
Snyder for supporting right-to-work laws and
Walker for stripping public sector employees of some collective
bargaining powers. Walker already survived one recall effort from
unions over his policies.
Possibly more important, though, is the victory by Democrat Gina
Raimondo in Rhode Island. As treasurer, Raimondo hammered out
significant public employee pension
reforms, forcing them into solvency and shifting employees into
hybrid plans to reduce the amount of potential debt obligations the
state would take on. Polls then showed union workers rallying
behind her Republican opponent, Allan Fung,
42 to 30 percent. She eked out a three-point victory,
nevertheless. (Also of interest: a third-party candidate, Robert
Healey of the Moderate Party, drew in 22 percent of the vote! Now
that’s how you spoil a race.)
On the flip side, a couple of public employee reforms on city
ballots failed. In
Phoenix, a ballot initiative to fight pension spiking and to
force new city employees into 401(k)-style defined contribution
plans
failed (warning: autoplay video), losing 43 to 57 percent.
Pension reform supporters had been applying a lot of pressure to
getting the ballot measure passed (The Reason Foundation: which
publishes this site and Reason magazine, produced reports
analyzing the impacts of the initiative). Opponents of reform
insisted that the initiative would have actually increased costs
rather than reducing them. Given that pension reform has shown to
be popular in polls in the much bluer state of California, it’s
possible that argument (despite being countered) may have played a
role in the initiative’s fate.
In a smaller loss, but a loss nevertheless, bankrupt San
Bernardino, California, has failed to make changes to the charter
so that the City Council can actually have some
control over public employee salaries. San Bernardino is
unusual in that the city’s charter gives its leaders absolutely no
control over public safety employee wages. Instead, their wages are
determined by calculating an average based on the salaries of
nearby similar-sized cities in California. Given that San
Bernardino is extremely poor and many nearby cities used for these
calculations are not, it means many city public safety employees
are getting wages (and therefore pensions) in the six-figure ranges
and well above what it’s poor citizens can afford. Measure Q would
have eliminated this part of the city’s charter and allow the city
to engage in collective bargaining with police and firefighter
unions just like most other California cities. It didn’t
necessarily mean the employees would get pay cuts, but it gave the
city the flexibility to try to actually negotiate for some.
However, Measure Q failed, 45 to 55 percent. The city will continue
to have to calculate salaries based on wages paid in nearby tony
communities like Irvine even while in the middle of a bankruptcy
reorganization.
If there is a message to take away from these results (hard
since the initiatives are in no way connected to the candidates
involved), it’s that non-union voters are less likely to punish
candidates for taking unions on, even when some candidates are on
the left. But pension and reform-based ballot initiatives have a
tougher fight because they are complicated, people don’t
necessarily grasp the long-term impacts, and they may not trust
ideology-driven analysis. And if they don’t grasp the outcome of a
ballot initiative, they’re probably likely to vote no.
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Colorado, Washington, and now Oregon and Alaska
are more or less following the model for legalizing and regulating
a drug that was set out after alcohol prohibition ended. The
initiative that passed in Washington, D.C., yesterday is a
little different.
Over at Slate, Mark
Kleiman notes that the law, as written, suggests something like
a “grow and give” system, in which residents are permitted to
cultivate, consume, and gift the drug, but the current ban on money
changing hands between growers and consumers remains in place.
The Daily Beast
chimes in in favor as well, decrying the “green rush” that has
occurred in other states and noting that “as we’ve seen with the
alcohol industry, the private profit-driven market of a drug can be
dangerous.”
(The D.C. City Council is
already working on a more conventional system, which would
permit the licensing of growers and distributors, but the future is
hazy.)
Kentucky Sen. Rand Paul’s right:
Three cheers for the laboratories of democracy and all that.
But “grow and give” is not going to work. And it’s not going to
work for reasons succinctly described
right in the middle of that Slate article about how
well it’s going to work:
It wouldn’t generate any tax revenue, or offer consumers the
same convenience or product variety as a commercial system, and of
course policing the boundary between “giving” and “selling” would
be virtually impossible. But it might be a big improvement on
the current prohibition. Eliminating organized marketing would
likely lead to a much smaller increase—if any—in cannabis abuse
than we would expect if we sell pot the way we now sell beer.
That “of course” is a really big deal. Contained in that “of
course” is all the violence and seediness of black markets, abuse
of search powers by the police, the large scale incarceration of
low-level drug offenders, and much, much more. “Grow and give”
would be an improvement on total prohibition, but it would also be
a step backward, a failure to learn from the lessons
of the experiments in Colorado and Washington State.
Kleiman quite reasonably asks: “Are we really satisfied with the
results of the current alcohol system?” Reason‘s answer
has long been clear: Nope!
But the addiction, safety, and health costs associated with
alcohol use aren’t caused by the fact that people can legally buy
and sell the stuff. Money changing hands for a bottle of clearly
labeled, cleanly manufactured gin in a well-lit store with regular
hours is by far the most wholesome part of the whole life-cycle of
booze.
By taking the money out of legal weed in D.C., the city will not
somehow elevate the exchange of marijuana to a higher, more
altruistic plane. Instead, it will force users and providers to
continue to operate outside the law and live with dangerous
uncertainty about what they’re buying, who they’re buying it from,
and what happens if the deal goes bad.
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Yesterday, moments after the WSJ reported that in October, the first full month of investor-flow data since Bill Gross’s stunning resignation on Sept. 26, “investors yanked an industry record $27.5 billion from Pacific Investment Management Co.’s flagship fund last month as the surprise exit of co-founder Bill Gross took its toll on the firm he co-founded, PIMCO was prepared for the damage control, issuing the following statement just minutes after the WSJ article.
PIMCO Statement Regarding October Total Return Fund Net Flows
- Fund assets were $170.9 billion as of October 31, 2014
- Daily flows from Total Return Fund peaked on September 26th and outflows continued to slow during October (see below chart)
- Flows during last five days in October were approximately one-tenth of the average daily flow during the first five trading days after Bill Gross’s departure
- Year-to-date in-flows into Income strategies are $13.0 billion globally
?Newport Beach, CA (November 4, 2014): The PIMCO Total Return Fund (“the Fund”) assets were $170.9 billion as of October 31, 2014, and the Fund remains the largest actively managed bond fund in the world. Outflows from the Fund slowed considerably during the month of October, to approximately $27.5 billion for the month, with nearly half of these flows occurring in the first five trading days. The daily average flow for the last five days in October was approximately one-tenth of the daily average flow during the first five trading days after Bill Gross’s departure, as illustrated in the below chart*.
“Flows from the Total Return Fund peaked on September 26th, and slowed sharply throughout October. October performance of +0.80% after fees was in line with the Total Return Fund’s peer group,” said Daniel Tarman, a PIMCO spokesperson.
On a trailing three-month basis the Fund achieved a return of +0.97% after fees, and year-to-date the Fund has achieved a return of +4.16% after fees.
The liquidity profile of the Fund remains high and, as always, the Fund is being managed consistent with the firm’s market outlook and alpha strategies while meeting diminishing redemptions. In addition, the Fund has maintained its desired portfolio structure with appropriate risk exposures as the fixed income markets remain liquid and well-functioning.
Importantly, several other PIMCO strategies and funds, such as the PIMCO Income Fund, continued to have positive inflows for the month. PIMCO’s $39 billion Income Fund achieved a return of +0.91% after fees in October. On a three-month trailing basis, the Income Fund achieved a return of +1.48% after fees, and year-to-date it has achieved a return of +8.24% after fees.
Year-to-date, PIMCO’s Income strategies have experienced $13.0 billion of positive flows globally.
We applaud PIMCO’s attempt to stem the bleeding, however by publicly confronting such a critical, for any asset manager, topic as fund outflows and even providing a handy daily chart of outflows, we fear it will only push the situation from bad to worse, as increasingly more investors ask themselves: “what are we missing.”
Especially since the appropriate chart to focus on is not the one showing the outflows from the TRF since September, but the one below, showing the epic devastation that the flagship fund, the Total Return Fund, of the world’s largest bond manager, has suffered since April 2013, when its AUM peaked at just inder $300 billion, and fast foward to October 2014, when it is now a whopping 42% lower and declining fast.
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Submitted by Charles Hugh-Smith of OfTwoMinds blog,
A recent revenue-enhancement fad in local government is to levy a tax on soft drinks. The tax is marketed to voters as a means of reducing soda consumption, which is presumed to be a contributor to the explosive rise in Type II diabetes, and more broadly, metabolic syndrome or diabesity.
The absurdity of taxing us to health is obvious – as is the unlimited greed and avarice of local government for more tax revenues, by any means available. Eat sugar, go to jail. The local Gulag would love it.
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