The United States is in worse financial shape than Greece due to the amount of money needed to cover future liabilities, says Bill Gross, head of Pimco, the world's largest bond fund. Lawmakers are debating raising a $14.3 trillion public debt ceiling to avoid an August default. Unfunded liabilities owed to programs like Medicare, Medicaid and Social Security, however, surpass $50 trillion."To think that we can reduce that within the space of a year or two is not a realistic assumption," Gross tells CNBC. "That's much more than Greece, that's much more than almost any other developed country. We've got a problem and we have to get after it quickly."Pimco manages more than $1.2 trillion in assets and runs the largest bond fund in the world. Many other financial and economic experts have made similar warnings recently.New York University professor Nouriel Roubini said during the weekend that a “perfect storm” of fiscal woe in the U.S., a slowdown in China, European debt restructuring and stagnation in Japan may converge on the global economy. There’s a one-in-three chance the factors will combine to stunt growth from 2013, Roubini, who predicted the global financial crisis, told Bloomberg.
Other possible outcomes are “anemic but OK” global growth or an “optimistic” scenario in which the expansion improves. “There are already elements of fragility,” he said. “Everybody’s kicking the can down the road of too much public and private debt. The can is becoming heavier and heavier, and bigger on debt, and all these problems may come to a head by 2013 at the latest.” Meanwhile, a recent USA Today study shows the government is facing $62 trillion in unfunded liabilities, mainly to Social Security and Medicare.
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