Investment Outlook: Reality Check

Bill Gross | December 2006

Things are seldom what they seem

Skim milk masquerades as cream


“H.M.S. Pinafore”

Gilbert & Sullivan


Reality is a delicate fabric. “You can’t handle the truth” was a famous Jack Nicholson courtroom one-liner, suggesting that even in the face of hard facts, people resort to self-deception in order to protect treasured illusions. How else to explain a recent poll by CNN that 54% of the respondents believed that OJ did not murder his wife and Ron Goldman? How else to explain that 77 of 100 U.S. Senators authorized Bush to invade Iraq under the pretense of Saddam’s potential use of weapons of mass destruction against the American public? I can only conclude that if reality is so delicate, subject to distortion even by a clear majority, then the lesson is that you should handle it carefully or at the least be prepared for the taste of skim milk instead of cream as we are warned in the caption above.
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