Last time this happened, retailers didn't have to accept them - your "IOU pay" you just deposited (like a check) in your own bank and YOUR BANK would then usually issue immediate credit. Who knows what might happen this time.
This is a quote from Rob Dawg in the previous thread that bears repeating (emphasis mine):
"The problem is systemic. The State government is so distant from the people that all their spending looks like OPM. "
I have to agree in California's case, and in fact I believe that this happens right down to the level of some cities and counties. It's particularly bad in Cali because so much of what used to be local spending is now state spending.
My question is this:
IS it illegal for people to counterfeit these IOU's as they are NOT legal tender?
Why would anyone who could refuse actually accept these things?
in my humble opinion the FEDs will come through,
they are faking fiscal prudence in DC...
CA is vital to BHO... the off year elections would be brutal,
helped Ford lose an election... (up until Ford to NYC: Drop Dead, that state was in play...)
"Theres a VERY simple solution: for every week that CA has no budget, all representatives forfiet their week of pay."
I'd be very surprised if the wages are all that big a portion of the income of the reps. (Just like the congresscritters'.) The whole notion of government official pay is a nasty snag in general though.
Yeah, I'd accept them, under conditions so onerous they'd discourage the use of IOUs in the first place. A 1:1 swap of an IOU's face value for dollars, however, is right out of the question.
All state debt will be backed or bailed; there's no other option.
I'm curious tho: Will the state accept their own IOUs? eg, quarterly tax payments.
If the state doesn't accept their own, there's gonna be a big problem...
c'mon, imagine that you are AIG and come up with an acceptable risk premium...
or a NPV based on future cash flows assuming they can't be redeemed at once but by serial
I'm not laughing at anyone but I am laughing. It's almost as if some people believe the Federal government has a choice as to whether to intervene in the California Meltdown. $1.8 trillion Gross product, by itself the size of the entire financial industry problem. And that's the thing to watch for. Another shock the size of the financial sector could be destabilizing because of the bailout. There's no one who doubts California is destabilizing without intervention.
The big question is whether Starbucks will accept IOUs. I mean if LA can't get their coffee fix, it will be anarchy in no time. Yes I am being sarcastic, but caffeine withdrawal is no joke. The times we live in.
Does this have something to do with the new Maury the Credit Responsibility Panda campaign that just received 10 billion dollars in congressional funding?
Hey, I've got an idea... let's seize all that California land. Use it to back a bond issuance supporting a new currency. We'll call it an "assignat". Or "asshat" for short.
"But if the county is still getting IOUs after Oct. 1, the problems would likely turn more severe. The county could be forced to issue its own IOUs to vendors, he said."
......this sounds like it could get dicey. Last time, the heat and phone calls the voters created about sent everyone off the deep end.
40 Million Americans on the U S Food Stamp Program
30+ Million Americans currently Unemployed in the USA!
$ 11.3 Trillion current U S National Debt. $ 1.3 Billion a day in Interest accumulated on this National Debt, $ 500+ Billion a year in Interest
on the National Debt.
30 Million+ Illegal's in the USA.
18 Million Vacant Houses/Condominiums in the USA. (Bloomberg.Com)
Credit Flows continue to worsen to Consumers and Companies.
You all remember when Arnold was campaigning he had Warren Buffet on his team and Warren recommended that taxes will have to be raised to pay for deficits/expenses or something to that effect, and Arnold dropped him like a hot potatoe? That's what ails California, IMHO. Nobody wants to pay for anything anymore.
shill (profile) wrote on Tue, 6/30/2009 - 12:59 pm
"Points To Ponder
40 Million Americans on the U S Food Stamp Program
30+ Million Americans currently Unemployed in the USA!
$ 11.3 Trillion current U S National Debt. $ 1.3 Billion a day in Interest accumulated on this National Debt, $ 500+ Billion a year in Interest
on the National Debt.
30 Million+ Illegal's in the USA.
18 Million Vacant Houses/Condominiums in the USA. (Bloomberg.Com)
Credit Flows continue to worsen to Consumers and Companies.
I hope I'm not misunderstanding your sentiment, but if you're saying that pandas aren't qualified to be public spokesmen then I have nothing to say to you.
It always ends like this.. various special interest groups holding each other to ransom.. generalized paralysis.. And no one wants to be reasonable and non-childish.
Long term--real estate taxes will have to rise substantially in CA--depressing real prices even further. If you own there now, sell--tomorrow's price will be worse--for sure.
I don't pay attn to CA budget issues. How much of CA's catastrophic mess is due to TOO MUCH DEBT SERVICE ? I recall during the brown-out enron mess they simply rolled it forward.
Like other government trust funds (highway, unemployment insurance and so forth), the Social Security and Medicare Trust Funds exist purely for accounting purposes: to keep track of surpluses and deficits in the inflow and outflow of money. The accumulated Social Security surplus actually consists of paper certificates (non-negotiable bonds) kept in a filing cabinet in a government office in West Virginia. These bonds cannot be sold on Wall Street or to foreign investors. They can only be returned to the Treasury. In essence, they are little more than IOUs the government writes to itself. Social Security and Medicare Projections: 2008 - Brief Analysis #616
Seriously, it is 14 hours plus two weeks. Really. No conjure countdown clock here.
I wonder if any of the suppliers to California have taken insurance? A lot of them are already knocked back on their heels. Last October medical claims were well past 90 days and it hasn't yet caught up. Nobody talks about this secret form of borrowing.
The clock is striking midnight on the $inderella story, when the Dow Cornings go flat, the Lexus turns into a Pinto (w/mag wheels) and the castle gets foreclosed once upon a time.
Califonia will get bailed, the've spunked trillions 'keeping this sucker up' (c) Bushwhacko ,so whats a few billion . There can be no triggered waterfall in the market as that is the backbone of their plan. Keep wall street up and it will somehow drag the world to victory. Without the SPX and Dow the have noting to hang their hope on, absolutely nothing as all the other data is BAD BAD BAD. California won't go down default as they won't allow it as it will mes up the big plan
Dollars are basically IOUs for a nonspecific value at some nonspecific point in the future.
Except that in the case of dollars, they can be used to pay your federal taxes. A large part of your expenses every year. I think this provides significant encouragement for dollars to also be used for other purposes.
i personally think that pandas are more qualified to speak for the public than some we have now. but not paying them in eucalyptus leaves instead of dollars,thats what i dont understand
Charles Kiting (profile) wrote on Tue, 6/30/2009 - 10:12 am
It's almost as if some people believe the Federal government has a choice as to whether to intervene in the California Meltdown.
Too big to fail?
Even if they don't have a choice on whether or not to intervene, the politboro DOES have a choice at to what the terms of the intervention will be.
IMo even the terms are severely constrained. For instance, CA is already at the taxation event horizon. Whatever form the relief takes it can't be tied to paying it back with higher taxes. Political reform? Can't happen. California is already Gerrymandered and designed to extract maximum Democrat advantage. any change would by definition diminish Democrat power. Repudiation of social services? Again Obama looks to CA for what he wants nationally. He can't reign in Ca without national repercussions.
All they have to do is create a Bad California and say all the Bad Stuff is banished to Bad California so Good California can resume its leveraged solipsism..
That could be high comedy. Imagine hucksters pleading for contributions like a PBS shill. Imagine the angry calls from the public. They could put the callers on live.
What a shame. Living here, you can quite readily see the elephants in the room.
Not taxing wealth, as defined by real estate, (unless you were one of the unfortunate who bought in the last 4 - 6 years). Numerous houses turned into income producing rentals, intergenerational transfers, corp. transfers, etc., with no benefit for the greater good.
The refusal to bring one of the hardest working group of people into the fold. Namely, by not enabling undocumented individuals a rapid means to citizenship, education and valid work, moving them from the underground economy into tax paying citizens, creating real economic velocity in the process.
Penalizing the young by decimating education at all levels and leaving serious pension/salary reform off the table.
Citizens have got to stop listening to the vocal luddites and get on with reform and an agenda that builds for the future.
Sally Struthers: "Buffy makes only $100k and is down to 3 lattes a day and 1 Gucci bag per month and she is overdue for her botox treatments. For your donation, you will receive Twitters from Buffy explaining how she is spending your money. Won't you please call now?"
IMo even the terms are severely constrained. For instance, CA is already at the taxation event horizon. Whatever form the relief takes it can't be tied to paying it back with higher taxes. Political reform? Can't happen. California is already Gerrymandered and designed to extract maximum Democrat advantage. any change would by definition diminish Democrat power. Repudiation of social services? Again Obama looks to CA for what he wants nationally. He can't reign in Ca without national repercussions.
Bailing out states will break the US's back. You can't do CA without doing all of them that have their hands out. The outcry will be too big.
@tbgpalisades - Prop 13 is so gone. There is no longer a choice. Might take a couple of years of really hard times to convince the rabble, but Prop 13 will at some point be flushed.
i dreamed last week that the fed had opened a window for states. they could get up to 25 billion at least i think it was a dream.
i was looking down at my monitor.i never look down at my monitor. i think im addicted to cr.
umm.. I have a plan how they can avert a budget crisis.. it's quite radical and complex and probably beyond the understanding of the very 'special' CA legislature.
It's called "you cut spending until it conforms to the available budget". Radical and probably an alien concept to the numb nuts up north.
Alternatively you raise taxes to the point of driving as many businesses and citizens out of the state.
I would at this point say "how the hell do we elect these f'tards", but seeing as they've managed to gerrymander the districts so nicely it's not like they're really elected, more just appointed by their parties.
Im with you BURN...just as the housing market finds a bottom and can withstand the pain (perhaps in 2012) they will spank the property tax monkey for all its worth.
We split it right around SLO. The south can keep santa barbara but we keep the paso robles wine area.
One thing i saw yesterday but noone commented on was a possible inmate sharing agreement between Michigan and Calif. Mich has empty prisons and needs inmates while CA has too many. I think it's a great cooperative idea which I'm sure the CA prison system will fight like cats and dogs.
BURN (profile) wrote (in reply to...) on Tue, 6/30/2009 - 10:27 am
@tbgpalisades - Prop 13 is so gone. There is no longer a choice. Might take a couple of years of really hard times to convince the rabble, but Prop 13 will at some point be flushed.
Prop 13 is the only thing working on the revenue side. I know how much people hate and/or misunderstand 13 but you have to understand removing its' protections won't even cause an exodus. There won't be time.
U-Haul 26' one-way Los Angeles to Austin $2151 Aug 1st pick-up
U-Haul 26' one-way Austin to Los Angeles $678 Aug 1st pick-up
The legislature has never actually SOLVED a spending problem by cutting spending. Traditionally they take on debt and raise taxes and fees. The fact that they might actually have to solve the entire problem without relying on debt has left them at a loss.
"3. Penalizing the young by decimating education at all levels and leaving serious pension/salary reform off the table."
during lunch with friends (everybody but a baby in their early 30s) we discussed where we were thinking about relocating. everybody but the baby plan to live abroad within 5 years. shocking!
is anybody seeing the same "planning on jumping ship" trend?
Russia has about 600 billion dollars in reserves. Could Russia lease San Francisco in return for a bailout? Hong Kong is a precedent, and after all, it wouldn't be the first time that Russia had a presence in California.
Missing tonight's deadline also means the governor and the Legislature would have to come up with about $3 billion in additional budget solutions. That's because in the accounting of competing budget plans by Schwarzenegger and the Democrats both include cutting education spending by about $3 billion in the 2008-09 fiscal year that ends tonight.
Prop 13 is the only thing working on the revenue side.
I've asked this before, but I'm not sure anyone knows the answer: How much additional revenue would occur if Prop 13 were removed? (Pretend no fluctuation in house prices/assessments.)
"U-Haul 26' one-way Los Angeles to Austin $2151 Aug 1st pick-up
U-Haul 26' one-way Austin to Los Angeles $678 Aug 1st pick-up"
New business plan:
1. Load a 26' U-Haul from Austin with cartons of low-tax cigarettes.
2. Drive it to Los Angeles, sell the cigs on the black market, return the truck.
3. Profit!!!
Just trying to help out with the obvious trade imbalance between LA and Austin.
Bob_in_MA (profile) wrote on Tue, 6/30/2009 - 10:39 am
This is from the article CR links to:
Missing tonight's deadline also means the governor and the Legislature would have to come up with about $3 billion in additional budget solutions. That's because in the accounting of competing budget plans by Schwarzenegger and the Democrats both include cutting education spending by about $3 billion in the 2008-09 fiscal year that ends tonight.
Does anyone know what that's all about?
Last year it was $4b in "carryovers." $3b is an improvement. Nothing but a sleazy accounting trick that basically circumvents the balanced budget constitutional requirement. This time it won't work because the money was tagged for matching fed money. Thus without a 2010 budget they cannot backfill the deficit in the 2009 budget.
Smlandlord-probably as good as a business plan advertised this year. Don't forget to dress up the trailer and advertise debt reduction clinics in towns on Hwy 10 for some scalp change along the way...debt dudes "we come to you"
"or charge for water as if it were a finite resource? it is good policy long term. "
Great idea! I know people all over in the OC area that have pools that are utilized few times a year, wastes thousands of gallons a year due to evaporation.
Bond interest is the one thing that California is paying with real money. This happens every state budget because of the 2/3 vote requirement to pass a budget and the fact that just over 1/3 of the legislature is made up of republicans who have the power to stop anything from getting done but not the power to do anything.
There is no question that California will be bailed out and that can will be kicked down the road some more. That is the official policy of the USA now to keep the system limping along as long as it can until it collapses. Everybody knows that collapse is inevitable but I bet the PTB can keep it propped longer than most would think.
As an independent country, CA would be much better off than the U.S. as a whole or as it is as a U.S. state. It's a shame that succession isn't an option.
Reporting live from hoocoodanode in California - 13 hours and counting to IOYs. Breaking developments....!!!
After a one hour aromatherapy break, state lawmakers (in the immortal words of "Terrible" Tim Witherspoon) are feeling "rejuberated" and ready for action. The likely action : mud baths. Nothing better than daydreaming while steeped in a bath of your own and others feces.
Adobe Shuts Down For A Week To Survive The Recession Adobe Shuts Down For A Week To Survive The Recession (ADBE)
Second-quarter sales fell 21 percent as customers held off upgrading to the latest version of Adobe’s Creative Suite programs, which account for about 60 percent of revenue.
Ouch.
New business plan:
1. Load a 26' U-Haul from Austin with cartons of low-tax cigarettes.
2. Drive it to Los Angeles, sell the cigs on the black market, return the truck.
3. Profit!!!
Just trying to help out with the obvious trade imbalance between LA and Austin
Revise business plan: Pick up U-haul in El Paso ($682 1 way to LA), buy cigs in New Mexico (lower cig taxes ), MORE PROFIT! For added revenue, pack 3 or 4 illegals in the truck as well.
"Everybody knows that collapse is inevitable but I bet the PTB can keep it propped longer than most would think."
It's only inevitable in the sense that politicians will not make the necessary hard choices.
What blows my mind is that anyone thinks that raising taxes is the answer. At best, that just kicks the can down the road.
Spending will always rise to consume all available dollars and then some more for good measure. Just like FBs that drove up housing prices, the pols will not stop until their funding is cut off.
This story for the past few months (but especially the past few weeks) has made the hair on the back of my neck tingle in a way it has not since spring 2008. Someone please let me know if my concern is misplaced, or if I'm correct in assuming that any misstep here by Californian politicians could have dire repercussions for their ability to service and expand their debt. Further, I assume this is going to be one of the first real tests of G8/Western country debt default skittishness on the part of buyers, so a misstep here by Cali could ripple through other weak (and eventually even strong) states, countries, and regional governments and severely restrict their level of spending.
Finally, seeing as we've made government the pillar of economic credit provision over the past few months, pushing out much private sector participation, could a default by CA lead to stress on the USD, thereby kicking the federal credit-provision legs out from under our economy again?
I'm not saying this right as I'm distracted in my office right now, but I'd really like to know if I'm out in left field or reasonable in my concerns here? For some reason, this has black-swan/Lehman brothers written all over it for me, and now there's no one who can swoop in and save the day if we start rocking this boat.
Amazing how little of this has been reflected in muni debt funds. Looking around at the Blackrock, Pimpco, Nuveen, they seem to be about a quarter off their 52w highs, substantially off their lows.
The wheels stay on longer than anyone thinks is possible.
dafox,
I think software providers are going to suffer quite a bit as businesses/governments can't afford to pay for the next upgrade of feature-bloated overpriced proprietary software.
I remember hearing this years ago and I'm sure it's an urban legend but did other states really give their welfare recipients one way tickets to CA in the 60s and 70s?
I wonder which is scarier, the 1.3T owed to the Chinese, or the 57T in medicare owed to the seniors (that's alot of walkers!)
The Chinese. We can always just put the elderly on ice floes. I'm sure that in the event of global warming we can rent them from Canada or Greenland for less that 57T.
ZackAttack;
"The wheels stay on longer than anyone thinks is possible."
Certainly longer than most think. Cali IOU threats are a nothingburger, and actually issuing them would not be a first. Investor inertia dictates that we'll have to see something really new to scare people out of bonds.
noob goldberg (profile) wrote on Tue, 6/30/2009 - 10:59 am
This story for the past few months (but especially the past few weeks) has made the hair on the back of my neck tingle in a way it has not since spring 2008. Someone please let me know if my concern is misplaced, or if I'm correct in assuming that any misstep here by Californian politicians could have dire repercussions for their ability to service and expand their debt.
The unspoken part is that the State's ability to expand debt has already been cut off. All the debt propositions failed and the muni market has pushed routine issuance above 6% double tax free. The credit card has been declined. Now we are forced to go to Guido "Green shoots" Obama the Chicago Southside loan shark and pay the vig.
IMo even the terms are severely constrained. For instance, CA is already at the taxation event horizon. Whatever form the relief takes it can't be tied to paying it back with higher taxes. Political reform? Can't happen.
The terms I'm talking about are horse trading. No bailout is going to happen without legislative action; the inevitability of a bailout will cost people like Waxman and Pelosi their committee chairman seats, etc.
"The wheels stay on longer than anyone thinks is possible."
Do what you can to not feed the beast. Cut down on your spending, cut down on your work hours, avoid taxes like crazy, change your money out of dollar, etc.
"Wrong. You need to do alot more research"
...
"Prove me wrong"
...
I would like to see some links as well. The only way I know of is also expensive, and that is to keep moving - don't stay anywhere long enough to outlast your visa.
Charles Kiting (profile) wrote on Tue, 6/30/2009 - 11:05 am
IMo even the terms are severely constrained. For instance, CA is already at the taxation event horizon. Whatever form the relief takes it can't be tied to paying it back with higher taxes. Political reform? Can't happen. - RD
The terms I'm talking about are horse trading. No bailout is going to happen without legislative action; the inevitability of a bailout will cost people like Waxman and Pelosi their committee chairman seats, etc.
What do Waxman and Pelosi care what happens to California? They're from Washington D.C. Besides, Obama needs tthem. Really, really needs tham as he is just beginning to discover. He didn't spend enough time back benching to collect chits and peek in closets. He's got nothing they want and taking away their power through the party is a recipe for 2010 loss of the House.
I appreciate the clarification, Rob, especially the bit on muni markets.
I'll pose my follow-up question in Bernanke-speak: Will this be contained to California or should I expect it to spill over into the rest of the market for sovereign debt? Maybe I should ask in terms of probabilities.
And I certainly appreciate the point of the earlier poster that this will take much longer to unwind then most people think. So did subprime, but I prefer to be prepared and aware in advance if possible
There are currently 844,000 foreclosures in process by agencies covered by this report (about 64% of all mortgage loans), This is essentially the same as the current annual Exiting Home Sales rate!
Recently ~50% of existing sales have been reported as foreclosures; if all the current foreclosure resulted in foreclosures that that rate would continue for at least two years. This assumes no new foreclosures and no contribution from foreclosures outside the purview of the report (an additional ~50%). Not bloody likely.
The government cannot allow this many foreclosures to go through. The market would be decimated. One way or another, loans WILL BE modified.
My guess is that most of the mods will be de facto, i.e. a continuation/expansion of lenders ignoring default situations.
"Feels like NYC in the '70s--the feds will come through."
The mother of all moral hazard - backstopping the financial choices of every podunk town, county and state with the resources of the Federal government.
Th US cannot afford to do that (except for people who are special friends of Congress, in which case there is NO LIMIT).
So, if the US does step up, it will be with some major conditions. They will not give money to California without telling them how to use it. They are incapable of doing otherwise.
"worry really really worry. it is the trickle across effect."
I feared as much. I don't know much about the market for government debt, so although it appears fairly bad to me as an observer, I figured I'd better ask. No sense worrying if it is a normal, regular issue they deal with every year.
The increased level of environmental controls has cost CA hundreds of thousands of jobs, 12% UE , some shifting to other states. Similar measures nationally supported by BHO will shift those jobs and millions of others offshore.
wouldn't single payer be a de facto bailout of CA (as well as every other state) by placing the state's health care benefits on the Federal Government's balance sheet? Monies already paid out to CalPERS and CalSTRS for health care bennies would then be returned back to the states.
"Whatever form the relief takes it can't be tied to paying it back with higher taxes."
So, that would be default? That will not help much for future financings. Probably a good thing, given Californians not wanting to pay for the services they get. I find it hard to see how the US Gov can help. Cali seems to be suffering from a terminal case of stupid. How does keeping that ponzi going help the US?
"So, if the US does step up, it will be with some major conditions. They will not give money to California without telling them how to use it. They are incapable of doing otherwise. "
I don't know...they're not having much luck telling bankers what to do, and they gave bankers much more
I'm with JP, how much would repealing Prop 13 help the budget?
If they raise the already high business taxes... they lose income tax.
If they raise the already high income tax... they lose income tax.
Every small business owner that I know is going to cut jobs if their taxes are raised. They all already take home less than their top earners.
I saw a projection that estimates California will only take in 43% of the required revenue for FY2010... Holy crap bat man!
Rob Dog is correct in that California has tapped out its ability to borrow. What I question is, how many contracts are broken by not making the budget on time? I really doubt anyone wants to lend to the state... if the State technically defaults, its time to collect and run...
As long as California conducts business in US dollars, California's problems are America's problems. Serves you all right for having ignored the issues for so long. The Feds looked the other way at Gerrymandering. The Recipient States saw nothing wrong with a negative balance of payment in 24 of the past 25 years. Everyone was glad to let illegal immigration problems concentrate.
My research shows that this is very hard to do without being rich. I've been looking at how to do this for many years and have found no easy way. If you found an easy way, let me know.
I don't think furloughing workers in CA is helpful for the budget. In California, you can collect unemployment when furloughed. And the state then pays the unemployment benefits.
So, it still costs the state 2/3 pay for furloughed workers, plus 100% benes. Except now, the work doesn't get done on furlough days.
The real test will be if the Indian casino's will accept the IOU's!
make you sure you bring a peace pipe filled with sage...it won't get you high but it will help stop them laughing and respect you more...
@ neil: I truly do not know the impact, my question was genuine. At this point, I'd believe the impact is minimal or maximal or anything in between. What is strange is that nobody seems to know the cost of that tax break in the middle of a budgetary maelstrom. I think that speaks volumes.
All I can speak to S. America. Ecuador and Brazil. Ecuador will give residency for a $25k CD deposited in one of their banks or a purchase of real estat assessed at $25k or more. The real estate purchase is tricky though. Values for taxation normally run approx. 25% of purchase price, as a guide only. Also, if you have income from SSI, pension,etc. over $800 monthly, residency status will be provided.
Brazil is $50k business investment or less depending on circumstances(how good/connected is your atty). Real estate purchase for residency was at $35k assessed last time I checked.
And in between, go to Japan or Taiwan or something. Travel a bit. Teaching English seems to be very profitable in China right now, so you can also get a sponsorship of visa from a language school
3, unless all those troops are squeezed into US bases, will do nothing more than swell UE even more. I'd like to see the US military have a less global presence too, but I'm not eager to see yet more unemployed and perhaps homeless people in the US. As it is, the US, thanks to Bush, Cheney, Inc., "support our troops" policies have guaranteed we'll see--are seeing--a replay of Vietnam on a smaller scale: insufficient VA funding, therefore inadequate staff & facilities to provide physical & mental health care, greatly slowed processing of applications for disability benefits, increased rate of denial of service-connected disability applications (even when SC disability is real), and, more homeless vets.
I'd substitute: no more privatization of military functions, support & otherwise. That might start to end the growth of military contractors like Xe, Fluor, et al. who seem to do horrible work anyway, when they do complete a project and who the military seems wholly unable to monitor & audit effectively.
Mel, if they do that then the government blinks and EVERY state will say the hell with disicipline and line up at the trough. What the hell do you think the foreigners will think about our lovely bond market. They will then know that when push comes to shove they are going under the bus. Who in the world will buy our junk paper? The end of this story comes when Obama informs americans that their 401k, 403b plans whatever will now only be allowed to buy american bonds, err, monopoly money.
creditcriminalslovetarp (profile) wrote on Tue, 6/30/2009 - 11:25 am
The real test will be if the Indian casino's will accept the IOU's!
make you sure you bring a peace pipe filled with sage...it won't get you high but it will help stop them laughing and respect you more...
Wont get you high? Man, you been smoking the wrong Golden Bear Chits man! White Sage Happitime California Special.
Seriously, does everyone understand that the furloughed State workers are collecting unemployment for their days off?
"Just what we need in Washington - another comedian."
I dunno, I've read some of his stuff and he is a pretty insightful guy. And with Colbert in Iraq and the Daily Show having someone in Iran, I'm seeing some of the best commentary coming from Comedy Central. Sometimes having someone from outside the system is just what you need to poke holes in the systemic issues we have.
I kind of wish I had been following that Senate race a little more closely, as it should make for a pretty good movie.
@ azurite (profile) wrote (in reply to...) on Tue, 6/30/2009 - 11:28 am
I'd like to see the US military have a less global presence too...
The MSM and Obama admin doing best to the green shoots economy meme alive as America's debt continues to explode U.S. National Debt Clock : Real Time - see defense as top 4 biggest budget item that should be pared as the idiots in US Congress ( House ) just passed $550b Pentagon budget ( nice to see US has its priorities straight )
What's the big deal about California issuing IOU'S? The Federal Reserve has been doing it since 1913; that $1 fed dollar in your wallet states " this note is legal tender for all debts, public and private." The fed-mobsters might throw a hissy fit that California is encroaching on their domain.
"All the perplexities, confusion and distress in America arise, not from defects in their Constitution or Confederation, not from want of honor or virtue, so much as from the downright ignorance of the nature of coin, credit and circulation." John Adams
btw, I'd like to see the reserves pulled out of Hawaii, so we don't have to pay for them to suntan on the gorgeous beach, and cruise in the beautiful mountain on my tax money (although I don't pay tax anymore ) I saw so many of them on the beaches in Oahu last week, just suntanning and enjoying the view. Granted, maybe they were keeping an eye out for the North Korea missiles
And yet growth in state government spending has FAR outstripped this.
Education:
up 114%
Protection (fire, police, prisons):
Up 144%
Pensions for state workers :
Up 158%
I used to consider myself a Democrat, but I am disgusted beyond belief that they are unwilling to budge on spending. Presented with the simple statistical facts above, how can anybody say with a straight face that spending growth is not a large part of the problem?
Speed (profile) wrote on Tue, 6/30/2009 - 2:35 pm replyIgnore userI believe that you need to be a resident to open an account in an Ecuadorian bank or buy property there. This may be a recent change in law.
Recent books on expatriating don't mention the Central/South American countries.
I've been there 6 times in the last 18 months, paid my immigration atty there a deposit, met with her every trip. I can't help you anymore than I have
Bad news in America seems to strengthen the usd--the rush to safety--made no sense, but happened all year--and will again. The rest of the world is even worse than CA?
splat...OMFGl_d, "cut spending until it conforms to the available budget"...how heartless can you be. You need to be sent to one of the libtards redumacation camps.
Obamma,s policies may not be working as well as many had hoped:
1st 100 days - There are 2.9 million more people unemployed in May than there were unemployed in January. The unemployment rate went from 7.6% to 9.4%. Since May 2008, we have lost 5.5 million jobs. The biggest losers were: Manufacturing 1.5 million lost Finance & Prof Serv 1.5 million lost Construction 1.1 million lost Retail & Leisure 1.3 million lost
Work permit is the issue. These countries are happy to take your money, so long as it comes from outside the country. The countries you mentioned take in retirees or employees of other countries. Work permits are not so easy.
"There is no "Chapter" for states. "
Then we'll have to invent one. How about "86" or "99"? Since it is california how about Chapter 69 or perhaps Chapter 88?
Speed, the comment “We can’t stress it strongly enough. We have never defaulted on a debt service payment, and we will not default." Reminds me of the saying that is attributed to Otto von Bismark...no rumor can be considered to be true until officially denied by the government.
What's the difference between paying a bill with an IOU and not paying it?
Of course, this was done during the Great Depression. They called it "scrip," not IOUs.
Will California's IOUs circulate in the marketplace as an alternative currency, and what will be the exchange rate? What about the whole "bad money drives out good" thing?
RockyR (profile) wrote on Tue, 6/30/2009 - 11:50 am
@RD: Are those UHaul figures real or made up?
Los Angeles to Austin. What an upgrade!
Absolutely real. uhaul dot com nd you can do it yourself for city pairs. I've used this metric for years.
See here for more city pairs from 2007: Exurban Nation: U-Haul Index Charlotte
Hmm.. why isn't anyone discussing the easiest way for the state to fill the hole ? OUTLAW private wealth Many of us in CA still call it "The Peoples Soviet Socialist Republic of California" this would just be one more step.. If it wasn't for the work and the climate I'd considering moving instead of living the state of emergency
Jct: There’s nothing wrong with small denomination California State IOUs if I or anyone else can pay their taxes with them. When Argentina’s government workers were faced with cuts, their unions talked 6 state governments into paying them with small-denomination state bonds which could be used to pay for state services and taxes and which everyone accepted as useful currency. Best of all, when the local currency is pegged to the Time Standard of Money (how many dollars per unskilled hour child labor) Hours earned locally can be intertraded with other timebanks globally! In 1999, I paid for 39/40 nights in Europe with an IOU for a night back in Canada worth 5 Hours.
U.N. Millennium Declaration UNILETS Resolution C6 to governments is for a time-based currency to restructure the global financial architecture. See my banking systems engineering analysis at YouTube
- kingofthepaupers's Channel
Too bad California State IOUs won’t be accepted in payment for state taxes and services like state bonds were in Argentina. Too bad California State IOUs will be denominated too big to use as local currency. Too bad Argentina people were smart enough to avoid the tent-cities catastrophe and California people are too stupid to follow their example.
California should create CALIFORNIA-Dollars (Cali$) and pay all its state workers, debts, etc. in the Cali$ for the next 6 to 12 months.
Cali$ should be treated as an IOU “currency”.
Cali$s can be exchange for $1.01 real US Dollars in 2012 but will expire (become worthless) in 2015.
Cali$s can be traded on an open market. And, California can buy the Cali$s off of the open market if it so desires using real USDs.
Cali$s can be used to pay all tax obligations to any California government and/or agency, including local property taxes. And, as they are collected by local governments, the local governments can use Cali$’s to pay all of their debts.
All real US $ currently collected by California (until they only get Cali$ in payments) should be invested in 1 to 2 year Treasuries. The money earned from them should be used to pay back the Cali$’s when are redeemed in 2012.
When issued, the California government should treat Cali$s as short term debt obligations equal to $1.01 on the books.
No way
theres a VERY simple solution: for every week that CA has no budget, all representatives forfiet their week of pay.
watch how fast we get a budget in place then!
Not a surprise. It seems like this happens every budget season in Cali. The only difference this time is that the numbers are bigger.
NO WAY MY FIRST HAT TIP!!!!!!!!!!!!!!!!!!!!
thank you CR!
I would like to thank the Academy....na- na just kidding
Kant ve just suspent dizbeleef like in ze moveez?
that is my question too cr, will walmart, exxon etc except ious? surely they have made arrangements,
Interesting supposedly they will be redeemable in Oct and pay interest until then.
IOU's will go to student tuition. What private school will take those. ?
Also no bank has agreed to take these in exchange for cash.
IOUs for everyone!
Just freakin' hilarious! When do they think they are going to have the money to pay these IOUs???
Obama will sweep in to save the day (and the stock market) again before COB on the WC.
"Will retailers accept IOUs?"
Their option... it is not legal tender.
I wouldn't.
Will the federal government accept CA IOUs as tax payment?
Feels like NYC in the '70s--the feds will come through.
SMLandlord"The only difference this time is that the numbers are bigger."
That, and the huge arson fires later this year. Oh, and the looting. and the large outward migration...
I can work in CA or TX for my current employer. I'm staying TX for the foreseeable future.
Not one cent
Only the state will take their own IOUs as tax payments
"Will retailers accept IOUs? "
Last time this happened, retailers didn't have to accept them - your "IOU pay" you just deposited (like a check) in your own bank and YOUR BANK would then usually issue immediate credit. Who knows what might happen this time.
I still want my IOU as a debit card I can swipe to pay the sales tax portion on purchases.
Yes, these instruments will "pay interest" but we won't know the rate until a vote on Jul 2nd.
IMO the Fed needs to step in immediately. this is counterfeiting and currency debasement. well that's what they do too but they hate competetion.
This is a quote from Rob Dawg in the previous thread that bears repeating (emphasis mine):
"The problem is systemic. The State government is so distant from the people that all their spending looks like OPM. "
I have to agree in California's case, and in fact I believe that this happens right down to the level of some cities and counties. It's particularly bad in Cali because so much of what used to be local spending is now state spending.
My question is this:
IS it illegal for people to counterfeit these IOU's as they are NOT legal tender?
Why would anyone who could refuse actually accept these things?
Tick-tock, tick-tock.
in my humble opinion the FEDs will come through,
they are faking fiscal prudence in DC...
CA is vital to BHO... the off year elections would be brutal,
helped Ford lose an election... (up until Ford to NYC: Drop Dead, that state was in play...)
"Theres a VERY simple solution: for every week that CA has no budget, all representatives forfiet their week of pay."
I'd be very surprised if the wages are all that big a portion of the income of the reps. (Just like the congresscritters'.) The whole notion of government official pay is a nasty snag in general though.
IMO the Fed needs to step in immediately. this is counterfeiting and currency debasement. well that's what they do too but they hate competition.
No way. This will kill the "green Shoots" MSM campaign.
I'm guessing the border will be having a reverse rush hour.
It is time for Total Recall of all CA officials:
Recall in California
10.... anyone... anyone... Bueller....
"IS it illegal for people to counterfeit these IOU's as they are NOT legal tender?"
Making replicas might be legal. Passing them off is still fraud.
Home Gnome.
I am sure the IOUs are linked with your tax payer code
Yeah, I'd accept them, under conditions so onerous they'd discourage the use of IOUs in the first place. A 1:1 swap of an IOU's face value for dollars, however, is right out of the question.
All state debt will be backed or bailed; there's no other option.
What are the rules about default on IOU's?
So what are they planning to call the Cali IOUs?
I suggest "Bear Bucks".
Tim, I live on the right coast not the Red Star state.
Hu's your daddy?
Accepted at a nice discount, maybe.
404 - Not Found - sacbee.com
this is all i could find.
Will retailers accept IOUs?
Sure, the question is: At what discount?
I'm curious tho: Will the state accept their own IOUs? eg, quarterly tax payments.
If the state doesn't accept their own, there's gonna be a big problem...
Bear Patties.
Will retailers accept IOUs?
Dollars are basically IOUs for a nonspecific value at some nonspecific point in the future.
An economy based on IOUs lives and dies by its credibility.
I wonder if the state can sell bonds denominated in Bear Bucks?
c'mon, imagine that you are AIG and come up with an acceptable risk premium...
or a NPV based on future cash flows assuming they can't be redeemed at once but by serial
I'm not laughing at anyone but I am laughing. It's almost as if some people believe the Federal government has a choice as to whether to intervene in the California Meltdown. $1.8 trillion Gross product, by itself the size of the entire financial industry problem. And that's the thing to watch for. Another shock the size of the financial sector could be destabilizing because of the bailout. There's no one who doubts California is destabilizing without intervention.
The big question is whether Starbucks will accept IOUs. I mean if LA can't get their coffee fix, it will be anarchy in no time. Yes I am being sarcastic, but caffeine withdrawal is no joke. The times we live in.
shill,
I'm with ya...
mean if LA can't get their coffee fix, it will be anarchy in no time.
Well, it will be anarchy but everyone will be completely crippled so it'll be a non-violent type of anarchy.
bailing out a state and bailing out its creditors are not the same thing...
How soon do we get Resolution Trust?
I suggest "Bear Bucks".
Does this have something to do with the new Maury the Credit Responsibility Panda campaign that just received 10 billion dollars in congressional funding?
we won't know the rate until a vote on Jul 2nd.
The borrower gets to pick the interest rate?
Is this a pick-a-pay mortgage?
Let's see if CA votes itself a negative interest rate.
Hey, I've got an idea... let's seize all that California land. Use it to back a bond issuance supporting a new currency. We'll call it an "assignat". Or "asshat" for short.
ac
please say that you are kidding.
Maury The Panda: Remember, only YOU can prevent credit card default!
wrt name: I gotta go with Bear Chits.
Oh Gott, vehr ist my Nazional Guard vhen I need it most? And ze riot squads, can zhey cope?
Zack - for historical reasons, I'd prefer to see the land-backed currency called the security dollar.
Does a Bear Chit in the woods?
"But if the county is still getting IOUs after Oct. 1, the problems would likely turn more severe. The county could be forced to issue its own IOUs to vendors, he said."
......this sounds like it could get dicey. Last time, the heat and phone calls the voters created about sent everyone off the deep end.
Points To Ponder
on the National Debt.
Green shoots!
now that is funny!
It seems like every few weeks or so, with increasing pleasure, I say two things to myself:
"God I am glad I moved out of Cali in 07"
"Pity is in short supply"
ching is suppose to issue ious thursday.
zack attack only in cali
News Alert: State of California to file Chapter 13 bankruptcy Wednesday morning at 0800 in Federal Court!
Working on a link
You all remember when Arnold was campaigning he had Warren Buffet on his team and Warren recommended that taxes will have to be raised to pay for deficits/expenses or something to that effect, and Arnold dropped him like a hot potatoe? That's what ails California, IMHO. Nobody wants to pay for anything anymore.
There's gold in them thar hills! Well, except for the crap in their Government......
shill (profile) wrote on Tue, 6/30/2009 - 12:59 pm
"Points To Ponder
on the National Debt.
Green shoots!"
-I find your lack of faith disturbing-
Chapter 13 gives it away shill.
Can they use the IOU's to pay their IRS tax debts?....I thought NOT.
ac
please say that you are kidding.
I hope I'm not misunderstanding your sentiment, but if you're saying that pandas aren't qualified to be public spokesmen then I have nothing to say to you.
Chapter 13 requires less than $1.4 million in debt. (Yes, that's an M.) Chapter 9 would have been a more plausible choice.
I wondered what Dan Quayle was doing these days.
14 hours to go..
It always ends like this.. various special interest groups holding each other to ransom.. generalized paralysis.. And no one wants to be reasonable and non-childish.
Long term--real estate taxes will have to rise substantially in CA--depressing real prices even further. If you own there now, sell--tomorrow's price will be worse--for sure.
Will the USG bail? If so watch the 10yr.
I don't pay attn to CA budget issues. How much of CA's catastrophic mess is due to TOO MUCH DEBT SERVICE ? I recall during the brown-out enron mess they simply rolled it forward.
-I find your lack of faith disturbing-
And I find your lack of reality.....cartoonish..nothing more to add.
@shill
I'll call and raise you all in
9.8T in bailouts
Bloomberg.com:
News
11T in government debts
U.S. National Debt Clock
17T in corporate debts
OFF THE CHARTS; Who's Most Indebted? Banks, Not Consumers - NY Times
1T in credit card debts
Opposing Views: OPINION: Americans $1 Trillion in Credit Card Debt
11T in mortgages
Bloomberg.com:
News
52T in social security/medicare obligations
Medicare, Social Security Owe Up to $52 Trillion to Current Retirees a... ( Debts Up To Three and Half Times Grea...)
Like other government trust funds (highway, unemployment insurance and so forth), the Social Security and Medicare Trust Funds exist purely for accounting purposes: to keep track of surpluses and deficits in the inflow and outflow of money. The accumulated Social Security surplus actually consists of paper certificates (non-negotiable bonds) kept in a filing cabinet in a government office in West Virginia. These bonds cannot be sold on Wall Street or to foreign investors. They can only be returned to the Treasury. In essence, they are little more than IOUs the government writes to itself.
Social Security and Medicare Projections: 2008 - Brief Analysis #616
200T in derivatives in banks
OCC: OCC's Quarterly Report on Bank Derivatives Activities
In an adversarial system taking one for the team, means taking it from the team. The reasonable have already been eliminated.
"Golden Bear Chits."
Thread over.
Seriously, it is 14 hours plus two weeks. Really. No conjure countdown clock here.
I wonder if any of the suppliers to California have taken insurance? A lot of them are already knocked back on their heels. Last October medical claims were well past 90 days and it hasn't yet caught up. Nobody talks about this secret form of borrowing.
Wait till O can find a microphone, he will fix Cali.
The clock is striking midnight on the $inderella story, when the Dow Cornings go flat, the Lexus turns into a Pinto (w/mag wheels) and the castle gets foreclosed once upon a time.
Califonia will get bailed, the've spunked trillions 'keeping this sucker up' (c) Bushwhacko ,so whats a few billion . There can be no triggered waterfall in the market as that is the backbone of their plan. Keep wall street up and it will somehow drag the world to victory. Without the SPX and Dow the have noting to hang their hope on, absolutely nothing as all the other data is BAD BAD BAD. California won't go down default as they won't allow it as it will mes up the big plan
Dollars are basically IOUs for a nonspecific value at some nonspecific point in the future.
Except that in the case of dollars, they can be used to pay your federal taxes. A large part of your expenses every year. I think this provides significant encouragement for dollars to also be used for other purposes.
We need a Californiathon, stat.
I'll donate a couple of nickels (plugged)
It's almost as if some people believe the Federal government has a choice as to whether to intervene in the California Meltdown.
Too big to fail?
Even if they don't have a choice on whether or not to intervene, the politboro DOES have a choice at to what the terms of the intervention will be.
LOL @ dow cornings.
i personally think that pandas are more qualified to speak for the public than some we have now. but not paying them in eucalyptus leaves instead of dollars,thats what i dont understand
Charles Kiting (profile) wrote on Tue, 6/30/2009 - 1:12 pm
Even if they don't have a choice on whether or not to intervene, the politboro DOES have a choice at to what the terms of the intervention will be.
Choice is only relevant if you can make good ones.
Charles Kiting (profile) wrote on Tue, 6/30/2009 - 10:12 am
It's almost as if some people believe the Federal government has a choice as to whether to intervene in the California Meltdown.
Too big to fail?
Even if they don't have a choice on whether or not to intervene, the politboro DOES have a choice at to what the terms of the intervention will be.
IMo even the terms are severely constrained. For instance, CA is already at the taxation event horizon. Whatever form the relief takes it can't be tied to paying it back with higher taxes. Political reform? Can't happen. California is already Gerrymandered and designed to extract maximum Democrat advantage. any change would by definition diminish Democrat power. Repudiation of social services? Again Obama looks to CA for what he wants nationally. He can't reign in Ca without national repercussions.
All they have to do is create a Bad California and say all the Bad Stuff is banished to Bad California so Good California can resume its leveraged solipsism..
Good California = Northern California
Bad California = Southern California
That was easy.
"We need a Californiathon, stat."
That could be high comedy. Imagine hucksters pleading for contributions like a PBS shill. Imagine the angry calls from the public. They could put the callers on live.
"shill (profile) wrote on Tue, 6/30/2009 - 1:08 pm
-I find your lack of faith disturbing-
And I find your lack of reality.....cartoonish..nothing more to add."
Would my quote make more sense if I then said : I squish your neck using my mind?
Would my quote make more sense if I then said : I squish your neck using my mind?
And I would reply...................bring friends....little man.
What a shame. Living here, you can quite readily see the elephants in the room.
Citizens have got to stop listening to the vocal luddites and get on with reform and an agenda that builds for the future.
I find your lack of knowledge of movie references - disturbing.
what effect will this have on any cali bonds? anyone?
Yes Luke - I am your blogger...
NOOOOOOOOOOO!
Sally Struthers: "Buffy makes only $100k and is down to 3 lattes a day and 1 Gucci bag per month and she is overdue for her botox treatments. For your donation, you will receive Twitters from Buffy explaining how she is spending your money. Won't you please call now?"
I think the Fed will create a new program to allow the banks to accept California's paper in exchange for cash at face value.
Too much on Obama's plate to focus on California right now, so this one will be handled by Uncle Ben.
shill (profile) wrote on Tue, 6/30/2009 - 1:21 pm
Would my quote make more sense if I then said : I squish your neck using my mind?
"And I would reply...................bring friends....little man."
Apology accepted....Commander Shill
what effect will this have on any cali bonds? anyone?
Can't fool me, that's gotta be one of those rhetorical thingies.
IMo even the terms are severely constrained. For instance, CA is already at the taxation event horizon. Whatever form the relief takes it can't be tied to paying it back with higher taxes. Political reform? Can't happen. California is already Gerrymandered and designed to extract maximum Democrat advantage. any change would by definition diminish Democrat power. Repudiation of social services? Again Obama looks to CA for what he wants nationally. He can't reign in Ca without national repercussions.
Bailing out states will break the US's back. You can't do CA without doing all of them that have their hands out. The outcry will be too big.
It's going to be spectacular to watch...
News Alert: State of California to file Chapter 13 bankruptcy Wednesday morning at 0800 in Federal Court!
Working on a link"
I'll believe it when I see the believable link.
BURN (profile) wrote (in reply to...) on Tue, 6/30/2009 - 1:25 pm
It's going to be spectacular to watch..."
As Someone (Neil?) always says on these boards...."Got Popcorn?"
Fed bailout of Cali will backfire big time on BO. Don't they know that half the nation already hates Cali and the other 48% will, too, if they try it.
@tbgpalisades - Prop 13 is so gone. There is no longer a choice. Might take a couple of years of really hard times to convince the rabble, but Prop 13 will at some point be flushed.
i dreamed last week that the fed had opened a window for states. they could get up to 25 billion at least i think it was a dream.
i was looking down at my monitor.i never look down at my monitor. i think im addicted to cr.
pavel, he's being funny. There is no "Chapter" for states.
Apology accepted....Commander Shill
Is that a white flag I see....ok good enough....now lets concentrate on what is important...
U.S. Treasury moves against North Korean firm
U.S. Treasury moves against North Korean firm - MarketWatch
Too bad that muni debt isn't recourse.
Nice dam... I think I'll take it.
"There is no "Chapter" for states. "
Then we'll have to invent one. How about "86" or "99"?
IOUs....they're what's for dinner.
Next month : California to US govt : "I drink your milkshake. I drink it up!"
Trying Pavel....hard to link an email ( for reality purposes )....but as soon as I can confirm...I will post haste!..
Their back
AIG Signals More Losses on Derivatives Portfolio
AIG Signals More Losses on Derivatives Portfolio - WSJ.com
umm.. I have a plan how they can avert a budget crisis.. it's quite radical and complex and probably beyond the understanding of the very 'special' CA legislature.
It's called "you cut spending until it conforms to the available budget". Radical and probably an alien concept to the numb nuts up north.
Alternatively you raise taxes to the point of driving as many businesses and citizens out of the state.
I would at this point say "how the hell do we elect these f'tards", but seeing as they've managed to gerrymander the districts so nicely it's not like they're really elected, more just appointed by their parties.
The Federal Reserve is going to handle this. If it fails, BB is on the hook, not BHO.
Im with you BURN...just as the housing market finds a bottom and can withstand the pain (perhaps in 2012) they will spank the property tax monkey for all its worth.
Yes, the question is whether or not the banks will accept the IOUs - not the contractors.
Why can't California just get money from AIG like all the Wall*Streeters do?
E. Thomas
We split it right around SLO. The south can keep santa barbara but we keep the paso robles wine area.
One thing i saw yesterday but noone commented on was a possible inmate sharing agreement between Michigan and Calif. Mich has empty prisons and needs inmates while CA has too many. I think it's a great cooperative idea which I'm sure the CA prison system will fight like cats and dogs.
said Stuart Levy, Treasury under-secretary for terrorism
Notice that we have a Treasury under-secretary for terrorism but not a Treasury under-secretary against terrorism.
"3. Penalizing the young by decimating education at all levels and leaving serious pension/salary reform off the table."
no kidding. just using IOUs to pay for pensions and retiree health benefits till the last baby boomer dies will surely solve the budget issue.
"pavel, he's being funny. There is no "Chapter" for states."
OK. I did smell fish.
Burn:
You are singing sweet. Let's hope.
According to FN AIG is about to have another episode of sorts...
[ The Financial Ninja ]
"3. Penalizing the young by decimating education at all levels and leaving serious pension/salary reform off the table."
CA students can write for each test question, "IOU one right answer."
IOY just doesn't have the same zing as IOU
BURN (profile) wrote (in reply to...) on Tue, 6/30/2009 - 10:27 am
@tbgpalisades - Prop 13 is so gone. There is no longer a choice. Might take a couple of years of really hard times to convince the rabble, but Prop 13 will at some point be flushed.
Prop 13 is the only thing working on the revenue side. I know how much people hate and/or misunderstand 13 but you have to understand removing its' protections won't even cause an exodus. There won't be time.
U-Haul 26' one-way Los Angeles to Austin $2151 Aug 1st pick-up
U-Haul 26' one-way Austin to Los Angeles $678 Aug 1st pick-up
Any questions?
The legislature has never actually SOLVED a spending problem by cutting spending. Traditionally they take on debt and raise taxes and fees. The fact that they might actually have to solve the entire problem without relying on debt has left them at a loss.
@RobDawg
LOL, nice.
Schwarzenegger pushes to lower pension and retiree health care benefits for state workers hired after today.
Why doesn't he target existing bloat in the current pension programs?
"3. Penalizing the young by decimating education at all levels and leaving serious pension/salary reform off the table."
during lunch with friends (everybody but a baby in their early 30s) we discussed where we were thinking about relocating. everybody but the baby plan to live abroad within 5 years. shocking!
is anybody seeing the same "planning on jumping ship" trend?
Russia has about 600 billion dollars in reserves. Could Russia lease San Francisco in return for a bailout? Hong Kong is a precedent, and after all, it wouldn't be the first time that Russia had a presence in California.
Why doesn't he target existing bloat in the current pension programs?
Because future employees don't have any political clout.
Rob Dawg, that's a great data point.
This is from the article CR links to:
Missing tonight's deadline also means the governor and the Legislature would have to come up with about $3 billion in additional budget solutions. That's because in the accounting of competing budget plans by Schwarzenegger and the Democrats both include cutting education spending by about $3 billion in the 2008-09 fiscal year that ends tonight.
Does anyone know what that's all about?
maybe rent cali out to the chinese?
"Because future employees don't have any political clout. "
sure, they can only vote with their feet.
Prop 13 is the only thing working on the revenue side.
I've asked this before, but I'm not sure anyone knows the answer: How much additional revenue would occur if Prop 13 were removed? (Pretend no fluctuation in house prices/assessments.)
"maybe rent cali out to the chinese?"
or charge for water as if it were a finite resource? it is good policy long term.
WestSac_grrl (profile) wrote on Tue, 6/30/2009 - 10:31 am
We split it right around SLO. The south can keep santa barbara but we keep the paso robles wine area.
Ventura County to Monterey. Trust me, you need the ports.
Pavel,
Russian settlement
I was there on Saturday...Beautiful day
Fort Ross, California - Wikipedia, the free encyclopedia
green shoot for why people pay so much to live here...
Federal Judge says....nope!
Federal Judge Blocks Bankrupt California from Reducing Wages of State Workers
CNSNews.com - Federal Judge Blocks Bankrupt California from Reducing Wages of State Workers
It just gets better and better
"U-Haul 26' one-way Los Angeles to Austin $2151 Aug 1st pick-up
U-Haul 26' one-way Austin to Los Angeles $678 Aug 1st pick-up"
New business plan:
1. Load a 26' U-Haul from Austin with cartons of low-tax cigarettes.
2. Drive it to Los Angeles, sell the cigs on the black market, return the truck.
3. Profit!!!
Just trying to help out with the obvious trade imbalance between LA and Austin.
"planning on jumping ship"
It's not that easy. Try and get a visa longer than 6 mo. in any country - unless you're a millionaire or married to a foreign born.
One more hour lost. Any progress?
RD: U-Haul 26' one-way Los Angeles to Austin $2151 Aug 1st pick-up
U-Haul 26' one-way Austin to Los Angeles $678 Aug 1st pick-up
The Grapes of Wrath complete the circuit.
The Oakies are succeeded by the Flakies.
Bob_in_MA (profile) wrote on Tue, 6/30/2009 - 10:39 am
This is from the article CR links to:
Missing tonight's deadline also means the governor and the Legislature would have to come up with about $3 billion in additional budget solutions. That's because in the accounting of competing budget plans by Schwarzenegger and the Democrats both include cutting education spending by about $3 billion in the 2008-09 fiscal year that ends tonight.
Does anyone know what that's all about?
Last year it was $4b in "carryovers." $3b is an improvement. Nothing but a sleazy accounting trick that basically circumvents the balanced budget constitutional requirement. This time it won't work because the money was tagged for matching fed money. Thus without a 2010 budget they cannot backfill the deficit in the 2009 budget.
Fine - can we have them lease SB then (don't want to pay the upkeep on it) and give them everything below fresno in the CV?
Federal Judge says....nope!
Three day furlough is certain now. 5-day weekend every month.
GDD9000 (profile) wrote on Tue, 6/30/2009 - 5:45 pm
One more hour lost. Any progress?
They took an aromatherapy break.
Smlandlord-probably as good as a business plan advertised this year. Don't forget to dress up the trailer and advertise debt reduction clinics in towns on Hwy 10 for some scalp change along the way...debt dudes "we come to you"
"give them everything below fresno in the CV? "
Nope, all of that goes to the new state of "Inland Empire".
"or charge for water as if it were a finite resource? it is good policy long term. "
Great idea! I know people all over in the OC area that have pools that are utilized few times a year, wastes thousands of gallons a year due to evaporation.
Bond interest is the one thing that California is paying with real money. This happens every state budget because of the 2/3 vote requirement to pass a budget and the fact that just over 1/3 of the legislature is made up of republicans who have the power to stop anything from getting done but not the power to do anything.
Rob Dawg,
So, they were really short $3B for 2008-9, but assign money coming in during 2009-10 to fill that gap? And of course creating a new gap?
Jeez, those people really take arcane budget tricks to a new level. Why not just cut to the chase and start printing CaliDollars?
There is no question that California will be bailed out and that can will be kicked down the road some more. That is the official policy of the USA now to keep the system limping along as long as it can until it collapses. Everybody knows that collapse is inevitable but I bet the PTB can keep it propped longer than most would think.
As an independent country, CA would be much better off than the U.S. as a whole or as it is as a U.S. state. It's a shame that succession isn't an option.
Reporting live from hoocoodanode in California - 13 hours and counting to IOYs. Breaking developments....!!!
After a one hour aromatherapy break, state lawmakers (in the immortal words of "Terrible" Tim Witherspoon) are feeling "rejuberated" and ready for action. The likely action : mud baths. Nothing better than daydreaming while steeped in a bath of your own and others feces.
Run bond holders....run while you still can!
California Treasurer: We will not default on bonds
California Treasurer: We will not default on bonds - Silicon Valley / San Jose Business Journal:
here is the link
The Buzz: Michigan may soon house California inmates - Sacramento Politics - California Politics | Sacramento Bee
Michigan may soon house California inmates
Adobe Shuts Down For A Week To Survive The Recession
Adobe Shuts Down For A Week To Survive The Recession (ADBE)
Second-quarter sales fell 21 percent as customers held off upgrading to the latest version of Adobe’s Creative Suite programs, which account for about 60 percent of revenue.
Ouch.
Seems like it would be cheaper to just release most of the state's prisoners and give them bus tickets to any other state in the nation.
[U-Haul 26' one-way Los Angeles to Austin $2151 Aug 1st pick-up
U-Haul 26' one-way Austin to Los Angeles $678 Aug 1st pick-up]
During the 1st depression years the direction of travel was E to W. The 2nd one is in the opposite direction.
Good for the green shoot CA RE recovery!
thread music:
YouTube - Billy Preston - Nothing from nothing 1975
“We can’t stress it strongly enough. We have never defaulted on a debt service payment, and we will not default,” Dresslar said
Sounds suspiciously like the "well capitalized" denial.
New business plan:
1. Load a 26' U-Haul from Austin with cartons of low-tax cigarettes.
2. Drive it to Los Angeles, sell the cigs on the black market, return the truck.
3. Profit!!!
Just trying to help out with the obvious trade imbalance between LA and Austin
Revise business plan: Pick up U-haul in El Paso ($682 1 way to LA), buy cigs in New Mexico (lower cig taxes ), MORE PROFIT! For added revenue, pack 3 or 4 illegals in the truck as well.
"Everybody knows that collapse is inevitable but I bet the PTB can keep it propped longer than most would think."
It's only inevitable in the sense that politicians will not make the necessary hard choices.
What blows my mind is that anyone thinks that raising taxes is the answer. At best, that just kicks the can down the road.
Spending will always rise to consume all available dollars and then some more for good measure. Just like FBs that drove up housing prices, the pols will not stop until their funding is cut off.
Rapes of Graft...
“We can’t stress it strongly enough. We have never defaulted on a debt service payment, and we will not default,” Dresslar said.
Only the sith deal in absolutes.
This story for the past few months (but especially the past few weeks) has made the hair on the back of my neck tingle in a way it has not since spring 2008. Someone please let me know if my concern is misplaced, or if I'm correct in assuming that any misstep here by Californian politicians could have dire repercussions for their ability to service and expand their debt. Further, I assume this is going to be one of the first real tests of G8/Western country debt default skittishness on the part of buyers, so a misstep here by Cali could ripple through other weak (and eventually even strong) states, countries, and regional governments and severely restrict their level of spending.
Finally, seeing as we've made government the pillar of economic credit provision over the past few months, pushing out much private sector participation, could a default by CA lead to stress on the USD, thereby kicking the federal credit-provision legs out from under our economy again?
I'm not saying this right as I'm distracted in my office right now, but I'd really like to know if I'm out in left field or reasonable in my concerns here? For some reason, this has black-swan/Lehman brothers written all over it for me, and now there's no one who can swoop in and save the day if we start rocking this boat.
The CA propositions to fund this with debt or fund that with debt have turned the general fund into a quasi debt-servicing fund.
If there was a case to be made against direct democracy, this would be it.
On the other hand, the case for a representative democracy isn't that strong either when you look up past the cow fields towards Sacramento.
Speed (profile) wrote on Tue, 6/30/2009 - 1:44 pm reply Ignore user "planning on jumping ship"
It's not that easy. Try and get a visa longer than 6 mo. in any country - unless you're a millionaire or married to a foreign born.
Wrong. You need to do alot more research
"this is going to be one of the first real tests of G8/Western country debt default skittishness on the part of buyers"
I wonder which is scarier, the 1.3T owed to the Chinese, or the 57T in medicare owed to the seniors (that's alot of walkers!)
Amazing how little of this has been reflected in muni debt funds. Looking around at the Blackrock, Pimpco, Nuveen, they seem to be about a quarter off their 52w highs, substantially off their lows.
The wheels stay on longer than anyone thinks is possible.
dafox,
I think software providers are going to suffer quite a bit as businesses/governments can't afford to pay for the next upgrade of feature-bloated overpriced proprietary software.
I remember hearing this years ago and I'm sure it's an urban legend but did other states really give their welfare recipients one way tickets to CA in the 60s and 70s?
Zzzzzzzzzz........
I wonder which is scarier, the 1.3T owed to the Chinese, or the 57T in medicare owed to the seniors (that's alot of walkers!)
The Chinese. We can always just put the elderly on ice floes. I'm sure that in the event of global warming we can rent them from Canada or Greenland for less that 57T.
ZackAttack;
"The wheels stay on longer than anyone thinks is possible."
Certainly longer than most think. Cali IOU threats are a nothingburger, and actually issuing them would not be a first. Investor inertia dictates that we'll have to see something really new to scare people out of bonds.
noob goldberg (profile) wrote on Tue, 6/30/2009 - 10:59 am
This story for the past few months (but especially the past few weeks) has made the hair on the back of my neck tingle in a way it has not since spring 2008. Someone please let me know if my concern is misplaced, or if I'm correct in assuming that any misstep here by Californian politicians could have dire repercussions for their ability to service and expand their debt.
The unspoken part is that the State's ability to expand debt has already been cut off. All the debt propositions failed and the muni market has pushed routine issuance above 6% double tax free. The credit card has been declined. Now we are forced to go to Guido "Green shoots" Obama the Chicago Southside loan shark and pay the vig.
One-way tickets to China.
IMo even the terms are severely constrained. For instance, CA is already at the taxation event horizon. Whatever form the relief takes it can't be tied to paying it back with higher taxes. Political reform? Can't happen.
The terms I'm talking about are horse trading. No bailout is going to happen without legislative action; the inevitability of a bailout will cost people like Waxman and Pelosi their committee chairman seats, etc.
Wrong. You need to do alot more research
Prove me wrong
Can one of you go to Sacramento in CR attire and get the Mortgage Pig filmed there at the moment of truth?
"The wheels stay on longer than anyone thinks is possible."
Do what you can to not feed the beast. Cut down on your spending, cut down on your work hours, avoid taxes like crazy, change your money out of dollar, etc.
worry really really worry. it is the trickle across effect.
Speed (profile) wrote on Tue, 6/30/2009 - 2:05 pm replyIgnore userWrong. You need to do alot more research
Prove me wrong
No. Do more research to prove yourself right. I've been looking at this for over 2 years.
"Wrong. You need to do alot more research"
...
"Prove me wrong"
...
I would like to see some links as well. The only way I know of is also expensive, and that is to keep moving - don't stay anywhere long enough to outlast your visa.
Charles Kiting (profile) wrote on Tue, 6/30/2009 - 11:05 am
IMo even the terms are severely constrained. For instance, CA is already at the taxation event horizon. Whatever form the relief takes it can't be tied to paying it back with higher taxes. Political reform? Can't happen. - RD
The terms I'm talking about are horse trading. No bailout is going to happen without legislative action; the inevitability of a bailout will cost people like Waxman and Pelosi their committee chairman seats, etc.
What do Waxman and Pelosi care what happens to California? They're from Washington D.C. Besides, Obama needs tthem. Really, really needs tham as he is just beginning to discover. He didn't spend enough time back benching to collect chits and peek in closets. He's got nothing they want and taking away their power through the party is a recipe for 2010 loss of the House.
I've been looking at this for over 2 years.
Then you should know. I don't know what research you're looking at. Books have been written on the subject - all detailing how difficult it is.
I appreciate the clarification, Rob, especially the bit on muni markets.
I'll pose my follow-up question in Bernanke-speak: Will this be contained to California or should I expect it to spill over into the rest of the market for sovereign debt? Maybe I should ask in terms of probabilities.
And I certainly appreciate the point of the earlier poster that this will take much longer to unwind then most people think. So did subprime, but I prefer to be prepared and aware in advance if possible
As long as Bruce Malkenhorst still gets to pull down $600k+/year in pension benefits, I have zero sympathy for CA.
@sm_landlord
You can apply for multiple re-entry visa for China for one year
China Visa : Application, Requirements. Apply for Chinese Visas Online.
blub
blub
blub......
Revisiting the OCC/OTS post a few hous ago...
There are currently 844,000 foreclosures in process by agencies covered by this report (about 64% of all mortgage loans), This is essentially the same as the current annual Exiting Home Sales rate!
Recently ~50% of existing sales have been reported as foreclosures; if all the current foreclosure resulted in foreclosures that that rate would continue for at least two years. This assumes no new foreclosures and no contribution from foreclosures outside the purview of the report (an additional ~50%). Not bloody likely.
The government cannot allow this many foreclosures to go through. The market would be decimated. One way or another, loans WILL BE modified.
My guess is that most of the mods will be de facto, i.e. a continuation/expansion of lenders ignoring default situations.
JP,
Damnit!!! Wish I had thought of that.
"Feels like NYC in the '70s--the feds will come through."
The mother of all moral hazard - backstopping the financial choices of every podunk town, county and state with the resources of the Federal government.
Th US cannot afford to do that (except for people who are special friends of Congress, in which case there is NO LIMIT).
So, if the US does step up, it will be with some major conditions. They will not give money to California without telling them how to use it. They are incapable of doing otherwise.
"worry really really worry. it is the trickle across effect."
I feared as much. I don't know much about the market for government debt, so although it appears fairly bad to me as an observer, I figured I'd better ask. No sense worrying if it is a normal, regular issue they deal with every year.
Now, back to worrying (and preparing).
As long as Bruce Malkenhorst still gets to pull down $600k+/year in pension benefits
Trying to figure out what the city admin of a town 5 sq miles in area and 92 residents did to deserve a 1/2 salary and pension...
Noob: could a default by CA lead to stress on the USD, thereby kicking the federal credit-provision legs out from under our economy again?
Perhaps but a federal bailout might be worse in that regard.
China already warned the US to control spending.
Are IOU's more green shooties ?
No, don't worry.
It's all fixed now.
I heard it on the radio.
The increased level of environmental controls has cost CA hundreds of thousands of jobs, 12% UE , some shifting to other states. Similar measures nationally supported by BHO will shift those jobs and millions of others offshore.
We're all CA now?
wouldn't single payer be a de facto bailout of CA (as well as every other state) by placing the state's health care benefits on the Federal Government's balance sheet? Monies already paid out to CalPERS and CalSTRS for health care bennies would then be returned back to the states.
"Whatever form the relief takes it can't be tied to paying it back with higher taxes."
So, that would be default? That will not help much for future financings. Probably a good thing, given Californians not wanting to pay for the services they get. I find it hard to see how the US Gov can help. Cali seems to be suffering from a terminal case of stupid. How does keeping that ponzi going help the US?
Ah, Malkenhorst. You're my hero !
Welcome to Paradise - Forbes.com
"Perhaps but a federal bailout might be worse in that regard.
China already warned the US to control spending."
No question a fed bailout would be worse. As it stands we're subjects of the Dukes of Moral Hazard, as we're all citizens in their county.
This is turning into one weird economic system.
"Three day furlough is certain now. 5-day weekend every month. "
wow! that's a 14% salary cut. is it really gonna happen? cannot be across the board though, prison guards are needed every day of the week, for ex.
"So, if the US does step up, it will be with some major conditions. They will not give money to California without telling them how to use it. They are incapable of doing otherwise. "
I don't know...they're not having much luck telling bankers what to do, and they gave bankers much more
"Three day furlough is certain now. 5-day weekend every month. "
wow! that's a 14% salary cut. is it really gonna happen? cannot be across the board though, prison guards are needed every day of the week, for ex.
"Golden Bear Chits."
ROTFLMAO
I'm using this one every second I have a chance!
I'm with JP, how much would repealing Prop 13 help the budget?
If they raise the already high business taxes... they lose income tax.
If they raise the already high income tax... they lose income tax.
Every small business owner that I know is going to cut jobs if their taxes are raised. They all already take home less than their top earners.
I saw a projection that estimates California will only take in 43% of the required revenue for FY2010... Holy crap bat man!
Rob Dog is correct in that California has tapped out its ability to borrow. What I question is, how many contracts are broken by not making the budget on time? I really doubt anyone wants to lend to the state... if the State technically defaults, its time to collect and run...
Got Popcorn?
Neil
As long as California conducts business in US dollars, California's problems are America's problems. Serves you all right for having ignored the issues for so long. The Feds looked the other way at Gerrymandering. The Recipient States saw nothing wrong with a negative balance of payment in 24 of the past 25 years. Everyone was glad to let illegal immigration problems concentrate.
"given Californians not wanting to pay for the services they get"
extend that to the whole country. look at the entitlement issue, when did housewives contributed a dime?
The real test will be if the Indian casino's will accept the IOU's!
Take a name -
I'd really like to know how to do it easily.
My research shows that this is very hard to do without being rich. I've been looking at how to do this for many years and have found no easy way. If you found an easy way, let me know.
"As long as California conducts business in US dollars, California's problems are America's problems. "
lol, it would be funny is the feds tell Cali to stop using hte greenback... "you are hurting it!"
they could use a new currency called the oscars
I don't think furloughing workers in CA is helpful for the budget. In California, you can collect unemployment when furloughed. And the state then pays the unemployment benefits.
So, it still costs the state 2/3 pay for furloughed workers, plus 100% benes. Except now, the work doesn't get done on furlough days.
How exactly is that helpful?
Speaking of entitlements, how's this for Green Shooties in chart pron?:
Clusterstock CHART OF THE DAY: Americans Suckle On The Government's Teat
"extend that to the whole country."
Somewhat true, with the exception the California took it to a whole new level. "This one goes to eleven!"
The real test will be if the Indian casino's will accept the IOU's!
make you sure you bring a peace pipe filled with sage...it won't get you high but it will help stop them laughing and respect you more...
"you can collect unemployment when furloughed. And the state then pays the unemployment benefits."
even when furloughed only a few days per month? don't think that's true
@ Yancey: I am quite pleased with myself indeed.
@ neil: I truly do not know the impact, my question was genuine. At this point, I'd believe the impact is minimal or maximal or anything in between. What is strange is that nobody seems to know the cost of that tax break in the middle of a budgetary maelstrom. I think that speaks volumes.
MN supreme court declares Al Franken the winner...
We need more furlough!
We need more furlough!
All I can speak to S. America. Ecuador and Brazil. Ecuador will give residency for a $25k CD deposited in one of their banks or a purchase of real estat assessed at $25k or more. The real estate purchase is tricky though. Values for taxation normally run approx. 25% of purchase price, as a guide only. Also, if you have income from SSI, pension,etc. over $800 monthly, residency status will be provided.
Brazil is $50k business investment or less depending on circumstances(how good/connected is your atty). Real estate purchase for residency was at $35k assessed last time I checked.
The car tax never should have been repealed.
"Except now, the work doesn't get done on furlough days. "
State workers dont get work done on any days. May as well furlough them.
Yes you can collect unemployment but only if you make less then some crazy low wage durning that 7 day period.
You could cut all state workers and still not save much. It's the contractors, entitlement programs, and borked property taxes that do the damage.
@Speed
I posted above:
You can apply for multiple re-entry visa for China for one year
China Visa : Application, Requirements. Apply for Chinese Visas Online.
And in between, go to Japan or Taiwan or something. Travel a bit. Teaching English seems to be very profitable in China right now, so you can also get a sponsorship of visa from a language school
Shill,
3, unless all those troops are squeezed into US bases, will do nothing more than swell UE even more. I'd like to see the US military have a less global presence too, but I'm not eager to see yet more unemployed and perhaps homeless people in the US. As it is, the US, thanks to Bush, Cheney, Inc., "support our troops" policies have guaranteed we'll see--are seeing--a replay of Vietnam on a smaller scale: insufficient VA funding, therefore inadequate staff & facilities to provide physical & mental health care, greatly slowed processing of applications for disability benefits, increased rate of denial of service-connected disability applications (even when SC disability is real), and, more homeless vets.
I'd substitute: no more privatization of military functions, support & otherwise. That might start to end the growth of military contractors like Xe, Fluor, et al. who seem to do horrible work anyway, when they do complete a project and who the military seems wholly unable to monitor & audit effectively.
"MN supreme court declares Al Franken the winner... "
Just what we need in Washington - another comedian.
Mel, if they do that then the government blinks and EVERY state will say the hell with disicipline and line up at the trough. What the hell do you think the foreigners will think about our lovely bond market. They will then know that when push comes to shove they are going under the bus. Who in the world will buy our junk paper? The end of this story comes when Obama informs americans that their 401k, 403b plans whatever will now only be allowed to buy american bonds, err, monopoly money.
maybe what is needed is a company town,lots of them
@shill
I like some of the items on your list - I think just backing away from #2 makes #4 un-necessary, but...
1. Fire Pelosi, hire Lee Iaccoca
...you do realize he was part of a government bailout of Chrysler, right? Yeah, he paid it off, well ahead of schedule, but really...
And on #5: dream on, it has never been thus, from the very first days of the Republic!
creditcriminalslovetarp (profile) wrote on Tue, 6/30/2009 - 11:25 am
The real test will be if the Indian casino's will accept the IOU's!
make you sure you bring a peace pipe filled with sage...it won't get you high but it will help stop them laughing and respect you more...
Wont get you high? Man, you been smoking the wrong Golden Bear Chits man! White Sage Happitime California Special.
Seriously, does everyone understand that the furloughed State workers are collecting unemployment for their days off?
Yes Luke - I am your blogger...
NOOOOOOOOOOO!
BWahahaha...thank you very much for a much needed mid-afternoon chuckle...
Next Segment Of The Housing Market To Crash: $1+ Million McMansions
Next Segment Of The Housing Market To Crash: $1+ Million McMansions
Us, in CA, are so screwed...I suspect that its time for a state convention to re-write our constitution...
CA is number one!
This may be a new wave of what the rest of the nation's states will end up doing....
When you sign a mortgage, you are promising your future labour, time and skill on a piece of paper.
The "Federal Reserve Note" you guys are carrying in your pockets is promising the exact same thing, but on a national level.
If your skill set cannot fullfil your promises, the value of your promise to pay back goes to zero.
What is the likelyhood that California and thus the USA will be able to pay back its promises?
Clearly... The only way to fix all these problems is more entitlements. That's BHO's approach.
"Yes you can collect unemployment but only if you make less then some crazy low wage durning that 7 day period. "
"What is the likelyhood that California and thus the USA will be able to pay back its promises? "
the point is: i didn't promise anything. why paying then?
"What is the likelyhood that California and thus the USA will be able to pay back its promises? "
the point is: i didn't promise anything. why paying then?
"Just what we need in Washington - another comedian."
I dunno, I've read some of his stuff and he is a pretty insightful guy. And with Colbert in Iraq and the Daily Show having someone in Iran, I'm seeing some of the best commentary coming from Comedy Central. Sometimes having someone from outside the system is just what you need to poke holes in the systemic issues we have.
I kind of wish I had been following that Senate race a little more closely, as it should make for a pretty good movie.
@ azurite (profile) wrote (in reply to...) on Tue, 6/30/2009 - 11:28 am
I'd like to see the US military have a less global presence too...
The MSM and Obama admin doing best to the green shoots economy meme alive as America's debt continues to explode U.S. National Debt Clock : Real Time
- see defense as top 4 biggest budget item that should be pared as the idiots in US Congress ( House ) just passed $550b Pentagon budget ( nice to see US has its priorities straight )
What's the big deal about California issuing IOU'S? The Federal Reserve has been doing it since 1913; that $1 fed dollar in your wallet states " this note is legal tender for all debts, public and private." The fed-mobsters might throw a hissy fit that California is encroaching on their domain.
"All the perplexities, confusion and distress in America arise, not from defects in their Constitution or Confederation, not from want of honor or virtue, so much as from the downright ignorance of the nature of coin, credit and circulation." John Adams
MaryAnn...you mean till he finds the teleprompter.
If the banks accept the IOUs, the problem will be 'solved' for awhile.
The trick is to get the banks to take on yet another (dodgy?) asset. The Fed will backstop CAs IOUs to keep the wheels of commerce flowing.
It's the cleanest, most politically expedient way to give CA more time.
Franken worries the Dems and the Repubs
Just to be 100% clear.
When you sign a mortage your have literally printed money for the banks.
Money that was never in existance until now.
Dang it. Pigged.
State workers dont get work done on any days. May as well furlough them.
Unlike those incredibly productive workers in the private sector who while away their workday hours on internet message boards.
Oh yeah, another northern rich liberal Democrat in the Senate. That'll add previously underrepresented views in that chamber.
I believe that you need to be a resident to open an account in an Ecuadorian bank or buy property there. This may be a recent change in law.
Recent books on expatriating don't mention the Central/South American countries.
--Also - those methods may help residency, but you still can't work there.
btw, I'd like to see the reserves pulled out of Hawaii, so we don't have to pay for them to suntan on the gorgeous beach, and cruise in the beautiful mountain on my tax money (although I don't pay tax anymore
) I saw so many of them on the beaches in Oahu last week, just suntanning and enjoying the view. Granted, maybe they were keeping an eye out for the North Korea missiles
According to usgovernmentspending.com:
Since FY1999 to FY2009
California GDP up 58%
And yet growth in state government spending has FAR outstripped this.
Education:
up 114%
Protection (fire, police, prisons):
Up 144%
Pensions for state workers :
Up 158%
I used to consider myself a Democrat, but I am disgusted beyond belief that they are unwilling to budge on spending. Presented with the simple statistical facts above, how can anybody say with a straight face that spending growth is not a large part of the problem?
Speed (profile) wrote on Tue, 6/30/2009 - 2:35 pm replyIgnore userI believe that you need to be a resident to open an account in an Ecuadorian bank or buy property there. This may be a recent change in law.
Recent books on expatriating don't mention the Central/South American countries.
I've been there 6 times in the last 18 months, paid my immigration atty there a deposit, met with her every trip. I can't help you anymore than I have
Bad news in America seems to strengthen the usd--the rush to safety--made no sense, but happened all year--and will again. The rest of the world is even worse than CA?
splat...OMFGl_d, "cut spending until it conforms to the available budget"...how heartless can you be. You need to be sent to one of the libtards redumacation camps.
Thats what I did!
Nei how, xiaojie!
Us, in CA, are so screwed...I suspect that its time for a state convention to re-write our constitution...
CA is number one!
This may be a new wave of what the rest of the nation's states will end up doing....
We need to stop the corruption by Goldman, bank of Amerika, and Jp Morgan. Stop the Geithner and bernanke. .
Financial Opinions Updated Daily iamned.com
read the full Rolling Stone [Taibbi] The Great American Bubble Machine article.
Obamma,s policies may not be working as well as many had hoped:
1st 100 days - There are 2.9 million more people unemployed in May than there were unemployed in January. The unemployment rate went from 7.6% to 9.4%. Since May 2008, we have lost 5.5 million jobs. The biggest losers were: Manufacturing 1.5 million lost Finance & Prof Serv 1.5 million lost Construction 1.1 million lost Retail & Leisure 1.3 million lost
good articles Financial Opinions Updated Daily iamned.com
recommended reading
Why isnt the stock market falling when the economy is sinking? Why cant we get change in Washington that we really need? Why vote?
Work permit is the issue. These countries are happy to take your money, so long as it comes from outside the country. The countries you mentioned take in retirees or employees of other countries. Work permits are not so easy.
"There is no "Chapter" for states. "
Then we'll have to invent one. How about "86" or "99"? Since it is california how about Chapter 69 or perhaps Chapter 88?
Speed, the comment “We can’t stress it strongly enough. We have never defaulted on a debt service payment, and we will not default." Reminds me of the saying that is attributed to Otto von Bismark...no rumor can be considered to be true until officially denied by the government.
@RD: Are those UHaul figures real or made up?
Los Angeles to Austin. What an upgrade!
Michigan may soon house California inmates
This could be the bubble we've been waiting for! We can all get rich trading prisoners to each other. It worked for houses, why not for prisoners?
What's the difference between paying a bill with an IOU and not paying it?
Of course, this was done during the Great Depression. They called it "scrip," not IOUs.
Will California's IOUs circulate in the marketplace as an alternative currency, and what will be the exchange rate? What about the whole "bad money drives out good" thing?
RockyR (profile) wrote on Tue, 6/30/2009 - 11:50 am
@RD: Are those UHaul figures real or made up?
Los Angeles to Austin. What an upgrade!
Absolutely real. uhaul dot com nd you can do it yourself for city pairs. I've used this metric for years.
See here for more city pairs from 2007:
Exurban Nation: U-Haul Index Charlotte
Re: "upgrade." Yeah, from 30% to 104% humidity.
Dawg is right, you need to spend a day East Central Texas in the summer before you make the move.
This could be the bubble we've been waiting for! We can all get rich trading prisoners to each other. It worked for houses, why not for prisoners?
Prison Guard wage labor arbitrage...jeebus pete...that's just...sick. Yeah,yeah, I know, people have been outsourcing prisoners for years.
Hmm.. why isn't anyone discussing the easiest way for the state to fill the hole ? OUTLAW private wealth
Many of us in CA still call it "The Peoples Soviet Socialist Republic of California" this would just be one more step.. If it wasn't for the work and the climate I'd considering moving instead of living the state of emergency 
Would anyone notice if 80% of lazy state employees got fired?
The car tax never should have been repealed.
<
p> Was the amount of money involved big enough to have made a difference?
<
p> In the same "what if" spirit: if Gray Davis had resigned, would Arnold have
ever become governor?
Jct: There’s nothing wrong with small denomination California State IOUs if I or anyone else can pay their taxes with them. When Argentina’s government workers were faced with cuts, their unions talked 6 state governments into paying them with small-denomination state bonds which could be used to pay for state services and taxes and which everyone accepted as useful currency. Best of all, when the local currency is pegged to the Time Standard of Money (how many dollars per unskilled hour child labor) Hours earned locally can be intertraded with other timebanks globally! In 1999, I paid for 39/40 nights in Europe with an IOU for a night back in Canada worth 5 Hours.
U.N. Millennium Declaration UNILETS Resolution C6 to governments is for a time-based currency to restructure the global financial architecture. See my banking systems engineering analysis at YouTube
- kingofthepaupers's Channel
Too bad California State IOUs won’t be accepted in payment for state taxes and services like state bonds were in Argentina. Too bad California State IOUs will be denominated too big to use as local currency. Too bad Argentina people were smart enough to avoid the tent-cities catastrophe and California people are too stupid to follow their example.
California should create CALIFORNIA-Dollars (Cali$) and pay all its state workers, debts, etc. in the Cali$ for the next 6 to 12 months.
Let the insanity continue.