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California AND bust - 11/7/2011 10:21:27 PM

Iamsemisweet

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From: The Great Northwest, USA
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http://www.vanityfair.com/business/features/2011/11/michael-lewis-201111

This article is frightening. Michael Lewis is a financial writer who was written about the financial crisis in Greece, Ireland, and now California, the 10th largest economy in the world. The biggest issue for California is also the biggest issue for probably every state - unfunded pension obligations of 1 Trillion dollars. California, like most other states, is pushing the problem off on the local governments. The mayor of Vallejo discusses the possibility of the city eventually employing one person - whose duty it will be to administer pensions. The housing bust and the municipal bond crash didn't help. In fact, when the credit rating of the US got cut, it wasn't treasury bonds that suffered, it was municipal bonds and the stock market. WTF?
I certainly don't begrudge public employees their pensions, but this is a disaster. There doesn't seem to be any way that these obligations can be met, and there is no way, short of bankruptcy, to get out of them.

_____________________________

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The Cat: Oh, you can't help that. We're all mad here. I'm mad. You're mad.
Alice: How do you know I'm mad?
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Post #: 1

RE: California AND bust - 11/7/2011 10:52:25 PM

Termyn8or

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Seen it coming for years.

Collective retirement plans are Ponzi schemes by nature. Either that or they must rape the markets and produce profits for nothing. People are living too long and not enough younger people are working. End of story.

You know what's even worse about all this ? If jobs do come back, alot fewer people have any kind of decent work ethic anymore. That's also an economy killer.

T^T

(in reply to Iamsemisweet)

Post #: 2

RE: California AND bust - 11/7/2011 10:56:55 PM

FirstQuaker

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Bankruptcy won't get California out of it. When all those governmental employees end up with no pensions, just what do you think the lines at the local welfare offices are gonna look like?

Elderly camping in parks because they had no money to pay the mile high property taxes.

Instead of living in nice assisted care retirement homes, they will be in state run nursing homes.

The UK is going through about the same thing right now, why you will likely see a big public sector pension strike this month.

And much like the USAsians got their savings and pensions looted by the banksters, the serfs in the UK had some preceding governments and their financial ncriminal's in looting the British equivlaent of 401K's and IRAs.

I started the thread on the new improved "Chained" CPI inflation factoring as this is another nice touch to strip mining the elderly and low income folks. I see Camoron's boys are already looking inot that Yank improvement, and Harper will not be far behind.

We will tax the capital held in savings and pension funds to benefit the corporate financial gangsters in in looting anything in the way of loose money they missed stealing during the last decade.

After all we can make the children of these rubes, pay for their elders care in taxes, instead of allowing these old fools to pay their own way.

The children of the world are unfortunate these creatures have discovered a way to remotely rob their piggy banks from a safe distance, and are steadily hauling off their little collections of coins too, for that is in all ways what they are doing.

As for California, the same "somebody local" i.e. the surviving taxpayers are gonna pay in any case, and there is nothing but political game playing to claim otherwise.

(in reply to Iamsemisweet)

Post #: 3

RE: California AND bust - 11/7/2011 11:24:32 PM

Termyn8or

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FQ, you know why I have no pension fund ? There was a time when I didn't know what it meant not to have money.

Look, even if you don't get ripped off, money is the fucking worst thing to have. Every day it is worth a little bit less. At one time the thing to have was property. This place was stolen for twenty grand. It got paid off. That's it. The fact that it quadrupled in value means nothing especially now that it has unquadrupled in value. What was the net result for me ? Nothing. I paid less interest than principle on it.

Then there is another house. Low hundreds during the bubble but needed work so there is considerable sweat equity. Sold out all retirement to get it - BEFORE THE CRASH. A stroke of luck, you could have nothing, or you could have the house and nothing. It is paid off, except for a small note that basically paid for a new driveway etc.

Don't buck the system FUCK THE SYSTEM. It takes a bit of luck I admit but it can be done. Fair is fair, becasue the system is out to fuck you.

All my jobs, and any business I've been in my motto is "My money now, all my money now". If I need someone to hold on to my money for me I will hide it in Mom's basement or some shit. No bank pays anywhere near enough to beat inflation, and this regular interest wouldn't support cat food and a cardboard fucking box. It wasn't so long ago that the prime rate was zero. Some incentive for saving huh ? Fuck you I'll buy and sell almost anything, silver, junk cars, ipads, you name it, it's all better than money. Find someone who can jailbreak phones and you'll be on easy street compared to having a structured retirement plan. If the events of the last few years aren't proof I don't know what is.

T^T

(in reply to FirstQuaker)

Post #: 4

RE: California AND bust - 11/7/2011 11:35:08 PM

FirstQuaker

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If I wanted to destroy capitalism, I could not do a better job of it, then the banksters are doing. Who in their right mind would attempt to accumulate any cashy money? Even the drug lords are converting it to tangible things whenever possible.

Basically they tax everyone who uses money, and then use inflation as a "property tax" on the stuff left in one place for any time.

California is going to discover the finer points of this.

(in reply to Termyn8or)

Post #: 5

RE: California AND bust - 11/8/2011 5:03:41 AM

FirmhandKY

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quote:

ORIGINAL: FirstQuaker

If I wanted to destroy capitalism, I could not do a better job of it, then the banksters are doing. Who in their right mind would attempt to accumulate any cashy money? Even the drug lords are converting it to tangible things whenever possible.

Basically they tax everyone who uses money, and then use inflation as a "property tax" on the stuff left in one place for any time.

California is going to discover the finer points of this.

The particular issue that sweet is discussing is about government unions having used their political influence for years in order to get better and better "pension" deals, so that it is now to the point that it is unsustainable.

This is not a "banker" issue.

Firm

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Post #: 6

RE: California AND bust - 11/8/2011 5:13:40 AM

servantforuse

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This is what caused the rukus in Wisconsin. The state employees will for the first time ever start paying for a portion of their health care and contributing a percentage for their retirement plans. All hell breaks loose when 'free' benefits finally have to be paid for.

(in reply to FirmhandKY)

Post #: 7

RE: California AND bust - 11/8/2011 5:18:04 AM

ArizonaBossMan

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California keeps electing nut job leftists... more and more government, more benefits for government workers... it is an unsustainable model. Why any businesses continue to remain in california is a mystery to me. I say let them boil in their own juices.

(in reply to servantforuse)

Post #: 8

RE: California AND bust - 11/8/2011 5:20:03 AM

Owner59

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From: Dirty Jersey
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The benefits were(are) part of their compensation.

There was nothing FREE about their health care.

They are be asked to take a pay cut or made to,is what this is.

This blame the unions thing is total republican bullshit.

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RE: California AND bust - 11/8/2011 5:25:51 AM

DomYngBlk

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This is what happens when you run up against a wall of "never any tax increases" rather decreases in taxation occur against an expanding set of financial requirements. It is a symptom of a generation of people that do not and will not take responsibility for their actions. If you don't increase revenues then, yes, you have a problem. However, the solution is sitting in front of all the Boomers that are running gov't today. What are they doing? Making sure they are taken care of and bending over anyone younger than them. Typcial.

(in reply to servantforuse)

Post #: 10

RE: California AND bust - 11/8/2011 5:32:04 AM

DarkSteven

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Um. Don't forget the glorious days of spiraling real estate and boom times. Nothing could go wrong and everyone was awash in prosperity.

Hangovers are a LOT less fun than the binges.

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Post #: 11

RE: California AND bust - 11/8/2011 5:34:35 AM

servantforuse

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To get out of their financial mess, CA will have to do what WI did. Make some tough choices.

(in reply to DomYngBlk)

Post #: 12

RE: California AND bust - 11/8/2011 5:41:21 AM

tazzygirl

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Like increasing taxes on the rich and famous?

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Post #: 13

RE: California AND bust - 11/8/2011 5:48:45 AM

servantforuse

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There are not that many rich people in Wisconsin and even fewer famous people. Raising taxes is not the answer.

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Post #: 14

RE: California AND bust - 11/8/2011 5:49:39 AM

Owner59

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Oh yes it is.

And make businesses pay their share.End the loop-holes,special breaks and dodges.

The middle-class is tired of funding them.

< Message edited by Owner59 -- 11/8/2011 5:51:49 AM >

_____________________________

"As for our common defense, we reject as false the choice between our safety and our ideals"

President Obama

(in reply to servantforuse)

Post #: 15

RE: California AND bust - 11/8/2011 5:50:34 AM

rulemylife

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quote:

ORIGINAL: FirmhandKY

The particular issue that sweet is discussing is about government unions having used their political influence for years in order to get better and better "pension" deals, so that it is now to the point that it is unsustainable.

Typical conservative-speak, and utter nonsense.

Retirement plans are deferred compensation, they are not some gift given to employees.

Many of these people accept lower wages because of that.

I know someone who worked in a city job since he was in high school. He just turned 41 and was planning on retiring at 45.

Then the city decided to try to push through a plan to not allow anyone to collect the pensions they worked for until the age of 57 and there has been a protracted lawsuit regarding it.

(in reply to FirmhandKY)

Post #: 16

RE: California AND bust - 11/8/2011 5:51:57 AM

servantforuse

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I guess that's up to the voters in CA. The voters in WI went a different direction.

(in reply to Owner59)

Post #: 17

RE: California AND bust - 11/8/2011 5:53:05 AM

tazzygirl

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I was referring to California.

_____________________________

Telling me to take Midol wont help your butthurt.
RIP, my demon-child 5-16-11
Duchess of Dissent 1
Dont judge me because I sin differently than you.
If you want it sugar coated, dont ask me what i think! It would violate TOS.

(in reply to servantforuse)

Post #: 18

RE: California AND bust - 11/8/2011 6:04:03 AM

Iamsemisweet

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From: The Great Northwest, USA
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One third of the article is about the governator, and his attempts to control public employee unions and state spending among other things, which were soundly beaten down by the voters. Arnold is a lot of things, but being a leftist is not one of them.

quote:

ORIGINAL: ArizonaBossMan

California keeps electing nut job leftists... more and more government, more benefits for government workers... it is an unsustainable model. Why any businesses continue to remain in california is a mystery to me. I say let them boil in their own juices.

< Message edited by Iamsemisweet -- 11/8/2011 6:09:51 AM >

_____________________________

Alice: But I don't want to go among mad people.
The Cat: Oh, you can't help that. We're all mad here. I'm mad. You're mad.
Alice: How do you know I'm mad?
The Cat: You must be. Or you wouldn't have come here.

(in reply to ArizonaBossMan)

Post #: 19

RE: California AND bust - 11/8/2011 6:10:44 AM

rulemylife

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quote:

ORIGINAL: servantforuse

This is what caused the rukus in Wisconsin. The state employees will for the first time ever start paying for a portion of their health care and contributing a percentage for their retirement plans. All hell breaks loose when 'free' benefits finally have to be paid for.

Hey Servant, how is your union-negotiated pension plan working out for you?

Enjoying your retirement?

But I never hear you offering to return those "free benefits" you are receiving.

(in reply to servantforuse)

Post #: 20

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