The Governement Bubble – National, State, Local…

Here are a couple of reposts from HighBoldtage Mar. 2010:

The Government Bubble:

It turns out that the bubbles that we have recently experienced – housing, derivatives, banking, insurance, stockes and so on were not just economic bubbles.  It appears that there was also a bubble in government at the same time, and this bubble is now bursting.

California is the poster child for this, with recent furloughs and i.o.u.s for state payments, but this week Los Angeles is starting to lay off 4,000 employees.  Cities all over California are beginning to downsize, along with school districts and transportation systems.  It looks like before it is over a hundred thousand or more government workers in California will soon be unemployed and the ripple effects of that will be immense, particularly in Sacramento.  Also heavily impacted will be the small rural counties like Humboldt where government payrolls account for 30% or more of the local economy.

The Federal government has its own bubble to deal with, with out of control deficit spending it will be unable to bail out the states.  The states will be unable to bail out the cities and counties.  You are on your own.  The Bubble Government is bursting.

have a peaceful day,

Bill

The Government Bubble in Humboldt County

There is one trend that is unmistakable in Humboldt County government:  It has gotten more expensive very quickly, at least as quickly as those dastardly insurance rates.  In just four years, county expenditures have gone up 41%, more than 10% per year.  How does that stack up to your personal experience, Joe Six Pack?

To put this nicely, if the county government increase had been limited to roughly the official inflation rate (lets say around 3%) then the county expenditures exceed that now by some $60,000,000 per year, and rising.  It is possible that Humboldt County residents are getting $60,000,000 worth of services now from their county government  that they didn’t get in 2004.  If so please inform us.  It is also possible that we are paying a lot more for the same thing we were getting in 2004.

http://co.humboldt.ca.us/portal/budget/2009-10/A.pdf

Why the Greek rescue isn’t going to plan

By Mohamed El-Erian

Published: April 7 2010 15:53 | Last updated: April 7 2010 15:53

It should be apparent to all by now: despite the rhetoric out of some European capitals, the Greek rescue package is not going according to plan.

Buoyed by a cyclical recovery, markets around the world have yet to recognise the complexity of this situation. When they do, it will also become apparent that Greece is part of a wider, and historically unfamiliar phenomenon – that of a simultaneous and large disruption to the balance sheet of many industrial countries. Tighten your seat belts.

Mohamed El-Erian is chief executive and co-chief investment officer of Pimco

Copyright The Financial Times

http://www.ft.com/cms/s/0/c2709314-4252-11df-9ac4-00144feabdc0.html

Is Bank of America Finished?

Is there a run on Bank of America today?  A rush for the exits?

and there’s this from ZeroHedge:

“Look for BAC to drop to under $6 once the market realizes the implications of this putback tsunami which has just hit the inverse mother lode: a lot of very pissed off German banks.”

http://www.zerohedge.com/news/will-start-landesbank-mortgage-litigation-against-bank-america-push-stock-new-52-week-lows

Anger in Rogue River Valley as Bankrupt Harry & David Crushed Under Buyout Debt

The failure of the 77-year-old company is raising anger locally at Wall Street, which is seen as recklessly borrowing to do the buyout without regard for the local economy, workers or the business.

“Buying a successful company like Harry & David, and crushing it under millions in bonding debt required to pay for the purchase may be known as brilliant financial maneuvering on Wall Street,” said state representative Dennis Richardson, whose district includes the Rogue Valley. Mr. Richardson added: “Oregon citizens have a different name for it.”

via the Wall St. Journal:
http://online.wsj.com/article/SB10001424052748703739204576229113684414704.html

Jeb Bush Advocates for States Rights – To Go Bankrupt

Of course he wants to use bankruptcy to cancel state employee contracts and benefits, but leave all the bondholders protected.

States may have to go bankrupt, but why shouldn’t the bondholders take a haircut along with everyone else?  BTW Newt Gingrich is on board for this tool.   Jeb Bush, Newt Gingrich, bootlickers to the rich.

These two clowns (I thought Jeb was the smart one in the family, but maybe not!)  have to twist themselves into logical pretzels to take the position that a FEDERAL JUDGE should overrule a state government (after all these Republicans are always talking about Big Government and activist judges) but it is clear that Republicans love BIG GOVERNMENT as long as big government SERVES THE RICH.

http://www.latimes.com/news/opinion/commentary/la-oe-gingrich-bankruptcy-20110127,0,4958969.story

Modoc County pop. 9,500 “Too Big to Fail?”

Is tiny and very Republican Modoc County in the sticks of northeast California “too big to fail” or is this just another Ponzi scheme put on by the cartel in Sacramento?   Is this just the government bubble?

“When a local entity files for bankruptcy protection, it has a ripple effect on the reputation of the state,” said Tom Dresslar, spokesman for state treasurer Bill Lockyer. “It creates headlines that do not serve the state well when it, for example, tries to sell bonds.””

http://urlet.com/discarding.entirely

http://www.google.com/hostednews/ap/article/ALeqM5ixHoviGa7vMvSkuA7qsBJG1N7oogD9H4E7S00

California’s Modoc County Teeters on the Brink of Bankruptcy

On Monday, Modoc County’s supervisors asked the investment board as a “last resort” to keep it afloat, saying that in the absence of state aid, the county cannot meet its July payroll. Supervisors also retained a law firm to prepare for bankruptcy.

Read more: http://blogs.sacbee.com/capitolalertlatest/2010/07/state-board-balks-at-emergency.html

Tuesday, June 22, 2010

BOS Accused of Lying

The Modoc County Board of Supervisors was accused today, June 22, of lying to the Monday Night Group.

The accusation came from Alan Hopkins a member of the ad hoc oversight committee, and was strongly punctuated by Realtor Janie Erkiaga.

http://modocindependentnews.blogspot.com/2010/06/bos-accused-of-lying-modoc-county-board.html

What the Board of Supervisors is facing is the financial entanglement of not enough income to pay expenses which includes an estimated $485,000 monthly payroll, a negative cash flow projection showing the county $321,271 in the red at the end of August, and a treasury that’s missing $12.5 million because the board used funds from it illegally.

http://modocindependentnews.blogspot.com/2010/07/modoc-county-to-prepare-for-bankruptcy.html

Banksters of America Hits a Judicial Speedbump in Utah Courtroom

(St. George, UT) June 5, 2010 – A court order issued by Fifth District Court Judge James L. Shumate May 22, 2010 in St. George, Utah has stopped all foreclosure proceedings in the State of Utah by Bank of America Corporation.

The second part of the motion, Barlow filed, claims that neither the lender, nor MERS*, nor Bank of America, nor any other Defendant, has any remaining interest in the mortgage promissory note. The note has been bundled with other notes and sold as mortgage-backed securities or otherwise assigned and split from the Trust Deed. When the note is split from the trust deed, “the note becomes, as a practical matter, unsecured.” Restatement (Third) of Property (Mortgages) § 5.4 cmt. a (1997). A person or entity only holding the trust deed suffers no default because only the note holder is entitled to payment. Basically, “[t]he security is worthless in the hands of anyone except a person who has the right to enforce the obligation; it cannot be foreclosed or otherwise enforced.” Real Estate Finance Law (Fourth) § 5.27 (2002).

Read more: KCSG Television – Judge James L Shumate Orders Halt to Bank of America Foreclosures in Utah

Democratic Underground:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102×4414910#4414915

More Housing Collapse Fallout: West Nile Virus

A crow found dead in Garden Grove May 18 is the first to test positive for West Nile virus this season, the Orange County Vector Control District says.

And the agency reported a potentially more troubling discovery: 5,000 neglected swimming pools detected in the county using aerial sweeps, potential breeding sites for mosquitoes that are largely the result of home foreclosures.

http://sciencedude.freedomblogging.com/2010/05/28/abandoned-swimming-pools-breed-west-nile-virus/100623/

65% fear their small business will fail

65% fear their business will fail

 

October 28th, 2009, 6:00 am by Jan Norman, small-business columnist

 

Almost two out of every three small-business owners are concerned their companies will fail by 2011, according to an online survey

http://jan.freedomblogging.com/2009/10/28/65-fear-their-business-will-fail/24287/

Feeling the Pinch? The Democratic-Republican Party and Bankruptcy Laws

Published on Friday, March 16, 2001

Bankruptcy laws were made much tougher – for you and I, but not corporations and Wall St. swindlers – a few years ago by a combination of Republicans and corporate fascist Democrats like Harry Reid.  Wake up.

http://www.commondreams.org/headlines01/0316-03.htm

Going Backwards

36 ‘Democratic’ Senators Vote For Credit Card/Banking Industry’s Bankruptcy ‘Reform’

…and they wonder why so many Democrats voted for Ralph Nader.

GW Bush and the credit card/banking industry won a huge victory last night as 36 ‘Democrats’ joined their Republican ‘colleagues’ and voted to pass S-420 – the Bankruptcy bill.

“Among Senate Democrats who may vote for the bankruptcy bill are Minority Leader Thomas A. Daschle (D-S.D.), whose state is home to a Citigroup Inc. credit card operation in Sioux Falls that employs several thousand people. Daschle has received $45,000 in political contributions from Citigroup in the last six years.” — Washington Post 3/11/01

The Sell Outs:

Daniel Akaka (Hawaii) senator@akaka.senate.gov

Max Baucus (Montana) http://www.senate.gov/~baucus/EmailMax.htm

Evan Bayh (Indiana) http://bayh.senate.gov/webmail.html

Joe Biden (Delaware) senator@biden.senate.gov

Jeff Bingaman (New Mexico) senator_bingaman@bingaman.senate.gov

John Breaux (Louisiana) senator@breaux.senate.gov

Robert Byrd (West Virginia) senator_byrd@byrd.senate.gov

Maria Cantwell (Washington) http://cantwell.senate.gov/mailform.html

Jean Carnahan (Missouri) senator_carnahan@carnahan.senate.gov

Thomas Carper (Delaware) http://carper.senate.gov/

Max Cleland (Georgia) http://www.senate.gov/~cleland/webform.html

Hillary Clinton (New York) senator@clinton.senate.gov

Kent Conrad (North Dakota) senator@conrad.senate.gov

Tom Daschle (Sorth Dakota) http://daschle.senate.gov/webform.htm

Byron Dorgan (North Dakota) senator@dorgan.senate.gov

John Edwards (North Carolina) http://www.senate.gov/~edwards/contact.html

Dianne Feinstein (California) senator@feinstein.senate.gov

Bob Graham (Florida) bob_graham@graham.senate.gov

Fritz Hollings (South Carolina) http://www.senate.gov/~hollings/webform.html

Daniel Inouye (Hawaii) http://www.senate.gov/~inouye/webform.html

Tim Johnson (South Dakota) tim@johnson.senate.gov

Herb Kohl (Wisconsin) senator_kohl@kohl.senate.gov

Mary Landrieu (Louisiana) http://landrieu.senate.gov/webform.html

Patrick Leahy (Vermont) senator_leahy@leahy.senate.gov

Carl Levin (Michigan) senator@levin.senate.gov

Joe Lieberman (Connecticut) senator_lieberman@lieberman.senate.gov

Blanche Lincoln (Arkansas) blanche_lincoln@lincoln.senate.gov

Barbara Mikulski (Maryland) senator@mikulski.senate.gov

Zell Miller (Georgia) http://miller.senate.gov/email.htm

Patty Murray (Washington) senator_murray@murray.senate.gov

Ben Nelson (Nebraska) http://www.senate.gov/senators/ben_nelson.html

Harry Reid (Nevada) senator_reid@reid.senate.gov

Chuck Schumer (New York) senator@schumer.senate.gov

Debbie Stabenow (Michigan) senator@stabenow.senate.gov

Robert Torricelli (New Jersey) senator_torricelli@torricelli.senate.gov

Ron Wyden (Oregon) http://wyden.senate.gov/mail.htm

Democrats Who Voted No:

Jon Corzine, N.J.; Mark Dayton, Minn.; Chris Dodd, Conn.; Dick Durbin, Ill.; Russ Feingold, Wis.; Tom Harkin, Iowa; Ted Kennedy, Mass.; John Kerry, Mass.; Bill Nelson, Fla.; Jack Reed, R.I.; John Rockefeller, W.Va.; Paul Sarbanes, Md.; Paul Wellstone, Minn.

Not Voting:

Barbara Boxer (California)