California economy is on the comeback trail. Can America Follow?

[FuzzyLumpkins]

The addition of hundreds of thousands of new jobs in the last two years and a soaring real estate market are leading the economic recovery in California, among the states that had been hardest hit by the recession.

But while California’s sheer size means its recovery is good news for the nation’s economy as a whole, many of the reasons experts cite for the turnaround are particular to the Golden State – including its geographic location, strong technology sector, and the quirks of its political leadership – meaning its success may not translate easily to other regions of the country.

And optimism about California’s recovery is somewhat tempered by the state’s severe, long-term fiscal challenges and the fact that two of the economic sectors fueling the jobs comeback – health care and trade – face uncertain futures, analysts say.

One indication of the rebound in the housing market is the dramatic year-to-year jump in the median price of homes in California’s six southern counties – the state’s most populous. According to La Jolla-based DataQuick, home prices were 28.3 percent higher in June than they were a year before, the fastest such rise in 10 years. That puts the median home price at $385,000, up from $300,000 in June, 2012.

And, after having the second highest unemployment rate in the nation for nearly two years – it hovered roughly at 10 percent – California’s current rate of 8.5 percent is now ninth in the country. Between April 2011 and April 2013, the state added 639,600 non-farm wage and salary jobs, or more than 300,000 per year. The state added another 16,800 jobs in May and 30,200 in June.

“The bottom line is that the technology sector in San Francisco and San Diego has been soaring and everyone has been building new commercial space,” says Steve Levy, president of the Center for the Continuing Study of the California Economy (CCSCE). “All of the data is showing California outpacing the nation in jobs for 24 months.”

http://www.csmonitor.com/USA/2013/0723/California-economy-is-on-the-comeback-trail.-Can-America-follow

[scroteface]

lmfao like california is some guiding light. that's a failed 3rd world state flooded with crime and illegals. can we kick them the fuck out of the US?

[SnakeBoy]

http://www.alaska-in-pictures.com/data/media/20/forever-blowing-bubbles_4463.jpg

[Th'Pusher]

I love it when conservatives get angry when California does well.

[angrydude]

lol. lol. lol. lol. lol. lol.

[Th'Pusher]

^^^ like that

[angrydude]

I hear china's economy is pretty kickass right now too. We should emulate that model

[scroteface]

I love it when conservatives get angry when California does well.

Honestly though all trolling aside you can't possibly spin it as "California doing well" by any metric. They're so in debt and fucked up it's not even funny. It's like when a black person gets into law school and makes it to the US senate and every other minority goes wild and blindly votes for them..it's just the exception not the rule. Even a blind squirrel is bound to find a nut every once in a while imho still wouldn't want to be California. It's a shame too, it used to be a pretty great place with cool people similar to Texas until the cooks moved in. The rural parts are still nice though.

[Th'Pusher]

I hear china's economy is pretty kickass right now too. We should emulate that model
Instead of cranking out ridiculous straw, why not address the facts of the article...do you not agree with the metrics the author uses to measure success?

[Th'Pusher]

Honestly though all trolling aside you can't possibly spin it as "California doing well" by any metric. They're so in debt and fucked up it's not even funny. It's like when a black person gets into law school and makes it to the US senate and every other minority goes wild and blindly votes for them..it's just the exception not the rule. Even a blind squirrel is bound to find a nut every once in a while imho still wouldn't want to be California. It's a shame too, it used to be a pretty great place with cool people similar to Texas until the cooks moved in. The rural parts are still nice though.

In all honesty, this is really a sub-par troll.

[InRareForm]

it is? :lol

[AntiChrist]

Up next, Detroit

[boobie4three]

Ten California Cities in Danger of Bankruptcy
Posted by Post Scripts @ 20 June 2013


Atwater. This farm city in the Central Valley declared a fiscal emergency in October with a $3 million deficit and appeared poised for a bankruptcy filing. City leaders say they pulled the city back from the brink after winning concessions from unions to cut costs. The deal cuts pay 5% for city workers, including police. Last month, voters approved a half-point sales tax increase to 8%. The city has cut jobs but struggled as costs on a new water treatment plant exceeded $85 million in bond financing.

• Azusa. This city east of Los Angeles saw its credit rating downgraded in 2012 by Moody’s and branded with a negative outlook by Standard & Poor’s. Analysts cited low general fund reserves, which fell to $50,000, or 0.17% of expenses, last August. A 2011 audit found the city’s general fund balance was almost entirely in restricted land assets.

• Compton. Bond-rating agency Standard & Poor’s downgraded, then stopped rating, this Los Angeles County city’s credit, citing the lack of an independent auditor’s opinion, structural deficits and weakened finances. The city has ran annual deficits that reached $40 million and are still projected at more than $9 million this year, and borrowed from dedicated accounts when its general fund ran short. It has laid off 15% of its employees and reduced services, from law enforcement to canceling a popular annual gospel concert. Standard & Poor’s said a 2011 audit was incomplete because of allegations of fraud and abuse of public money and a lack of response from the city to auditors’ questions. The city once known for crime disbanded its police force and now relies on Los Angeles County sheriff’s deputies — and was saddled with $369,000 in late fees for falling behind on payments to the county for those police services.

• Fresno. This Central Valley agricultural hub has been beset by annual deficits despite big cuts in spending and services, including a 25% reduction in the city workforce since 2009. Its credit rating was downgraded in 2012. The city has a $16 million deficit this year. In January, Standard & Poor’s gave Fresno’s credit a negative outlook “due to our view of the city’s significantly deteriorated financial position.” The city faces bigger annual payments for retired public workers because of poor investment returns for its defined benefit plan, the agency said. Fresno, like neighboring Stockton, has seen its financial stress compounded by double-digit unemployment in the region. The city is asking voters in June to approve privatizing garbage collection, which would produce a cash windfall of more than $10 million plus $2.4 million a year in franchise fees. City workers are fighting the change and petitioned to force a public vote on the plan.

• Hercules. This Contra Costa County city near San Francisco saw its credit ratings collapse seven grades to non-investment quality in 2012 as finances weakened and analysts questioned the city’s future willingness to repay debts. The city notified creditors last September that it “does not anticipate there will be any available funds” for debt payments “in the foreseeable future.” S&P says the city plans to use $4.5 million in unspent bond proceeds to pay debt service on other bonds but questions whether payments will be made when that money is exhausted. State Controller John Chiang issued audit reports in March saying, “The city’s books were so poorly managed that I must question their use of every single federal and state dollar.” Hercules has laid off 40% of public workers and last year defaulted on a bond payment, triggering a lawsuit.

• Mammoth Lakes. The mountain resort city filed for bankruptcy protection, then withdrew its petition last year after agreeing to a budget restructuring plan making settlement payments on a lawsuit that it lost. A developer, Mammoth Lakes Land Acquisition, filed suit charging that the city had breached a 1997 agreement to develop a hotel and condo project. The Hot Creek project stalled over federal objections that it would be too close to a planned airport runway expansion. A $30 million judgment, plus legal fees, against the city was upheld on appeal, and the city’s liability grew to $42 million, 2½ times its general fund budget. Standard & Poor’s says the city remains under financial pressure and rates its bonds at junk status.

• Monrovia. Standard & Poor’s sharply downgraded the city’s credit rating, citing a “substantially weakened general fund and liquidity position” coupled with the possibility it could lose pending litigation with a developer. It said the city’s general fund consisted “entirely of restricted and non-spendable assets.” Faced with declining tax and other revenue sources, the city cut staff 17% and reduced services, including street repaving, to balance its budget. Monrovia is 20 miles east of Los Angeles and one of several small cities along the foothills of the San Gabriel Mountains.

• Oakland. Plagued by high crime and lower revenue, this city on the east side of San Francisco Bay has cut police and other services while struggling to stay solvent. It has endured budget shortfalls of $318 million over the past six years and since 2008 has eliminated 16% of its workforce, or 720 jobs, while reducing pay and giving workers unpaid furloughs. Even with a recovering economy, the city is facing a $19 million shortfall in the coming year and projects a deficit of $35 million or more in 2015 as financial concessions made by public-employee unions expire and pension and retiree health benefits climb. The city has reduced its police force by 25% since 2009, to 626 officers, and the California Highway Patrol is helping police the city.

• San Jose. Being home to much of Silicon Valley’s tech riches has not spared the nation’s 10th-largest city from financial stress. The city has run 11 consecutive general fund deficits, and though it still has reserves, Standard & Poor’s downgraded San Jose’s credit rating in 2012 and branded it with a negative outlook, saying it still faces “long-term structural pressures.” The city has cut workers’ pay 10% and outsourced jobs but still foresees a $5.5 million deficit next year and nearly $14 million the year after. City officials say their biggest problem is retirement costs, which soared from $73 million in 2001 to $245 million last year. Cuts in public pensions approved by voters last fall are being challenged in court by unions. “Long-term budget obligations have outgrown the current revenue structure,” Standard & Poor’s said in January.

• Vernon. The smallest incorporated city in the state, with a population barely over 100, is an industrial center neighboring Los Angeles with 1,800 businesses and 55,000 jobs in 5 square miles. Vernon has a history of corruption and was the subject of a scathing report by the state auditor last July that said the city doesn’t have enough revenue to pay for the services it provides. The audit found Vernon operated with annual deficits in its general fund for more than 20 years, increasing spending and salaries while tapping dedicated funds, reserves, asset sales and other transfers. The audit said Vernon engaged in speculative investments without effective risk evaluation, including an “unreasonable” natural gas deal that has cost it millions. It cited loose contracting practices and found problems in 21 of 25 city contracts examined, including lack of competitive bidding. It said Vernon had weak internal financial controls and “may have provided legally questionable retirement benefits to certain current and past executives.” The city turned back efforts in the Legislature to disincorporate it last year and adopted reforms, but the auditor said some policy changes have not been implemented and others will take years to achieve. USA Today

Not far behind these ten are Chico, Oroville, Red Bluff, Marysville and Paradise. California now leads the nation in municipal bankruptcy filings. Stockton is the largest city yet to file for bankruptcy, marking a new low point in a trend sweeping California. Thank you democrats! Could you possibly be doing any worse?

Liberal democrats in Sacramento have single handedly taking the richest and most highly rated State down to it’s knees like a 3rd word country in the hands of a dictator. The policies of liberal democrats have ruined the State’s credit, ruined the school system, increased the drop out rate, raised welfare and more. Speaking of welfare did you know that California accounts for 32.62% of all the welfare rolls in the entire country? In 2013 we added an increase of 6.5%!

Democrats have forced on us the highest paid legislation in the nation, the highest paid state workers to be found anywhere, the worst performing legislature in the nation that must take full credit for chasing away businesses and jobs at a record rate. These fat cats in Sacramento have caused us to pay the most in taxes and get the least for it and they’re still raising taxes (see ACA 8).

Police and fire layoffs, bankrupt cities, failing schools, massive welfare, over regulation…none of this seems to matter to the voters of California, they voted the rascals in and they will re-elect them. That much you can count on! -Jack

http://www.norcalblogs.com/postscripts/2013/06/20/ten-california-cities-danger-bankruptcy/

[Th'Pusher]

Ten California Cities in Danger of Bankruptcy
Posted by Post Scripts @ 20 June 2013


Atwater. This farm city in the Central Valley declared a fiscal emergency in October with a $3 million deficit and appeared poised for a bankruptcy filing. City leaders say they pulled the city back from the brink after winning concessions from unions to cut costs. The deal cuts pay 5% for city workers, including police. Last month, voters approved a half-point sales tax increase to 8%. The city has cut jobs but struggled as costs on a new water treatment plant exceeded $85 million in bond financing.

• Azusa. This city east of Los Angeles saw its credit rating downgraded in 2012 by Moody’s and branded with a negative outlook by Standard & Poor’s. Analysts cited low general fund reserves, which fell to $50,000, or 0.17% of expenses, last August. A 2011 audit found the city’s general fund balance was almost entirely in restricted land assets.

• Compton. Bond-rating agency Standard & Poor’s downgraded, then stopped rating, this Los Angeles County city’s credit, citing the lack of an independent auditor’s opinion, structural deficits and weakened finances. The city has ran annual deficits that reached $40 million and are still projected at more than $9 million this year, and borrowed from dedicated accounts when its general fund ran short. It has laid off 15% of its employees and reduced services, from law enforcement to canceling a popular annual gospel concert. Standard & Poor’s said a 2011 audit was incomplete because of allegations of fraud and abuse of public money and a lack of response from the city to auditors’ questions. The city once known for crime disbanded its police force and now relies on Los Angeles County sheriff’s deputies — and was saddled with $369,000 in late fees for falling behind on payments to the county for those police services.

• Fresno. This Central Valley agricultural hub has been beset by annual deficits despite big cuts in spending and services, including a 25% reduction in the city workforce since 2009. Its credit rating was downgraded in 2012. The city has a $16 million deficit this year. In January, Standard & Poor’s gave Fresno’s credit a negative outlook “due to our view of the city’s significantly deteriorated financial position.” The city faces bigger annual payments for retired public workers because of poor investment returns for its defined benefit plan, the agency said. Fresno, like neighboring Stockton, has seen its financial stress compounded by double-digit unemployment in the region. The city is asking voters in June to approve privatizing garbage collection, which would produce a cash windfall of more than $10 million plus $2.4 million a year in franchise fees. City workers are fighting the change and petitioned to force a public vote on the plan.

• Hercules. This Contra Costa County city near San Francisco saw its credit ratings collapse seven grades to non-investment quality in 2012 as finances weakened and analysts questioned the city’s future willingness to repay debts. The city notified creditors last September that it “does not anticipate there will be any available funds” for debt payments “in the foreseeable future.” S&P says the city plans to use $4.5 million in unspent bond proceeds to pay debt service on other bonds but questions whether payments will be made when that money is exhausted. State Controller John Chiang issued audit reports in March saying, “The city’s books were so poorly managed that I must question their use of every single federal and state dollar.” Hercules has laid off 40% of public workers and last year defaulted on a bond payment, triggering a lawsuit.

• Mammoth Lakes. The mountain resort city filed for bankruptcy protection, then withdrew its petition last year after agreeing to a budget restructuring plan making settlement payments on a lawsuit that it lost. A developer, Mammoth Lakes Land Acquisition, filed suit charging that the city had breached a 1997 agreement to develop a hotel and condo project. The Hot Creek project stalled over federal objections that it would be too close to a planned airport runway expansion. A $30 million judgment, plus legal fees, against the city was upheld on appeal, and the city’s liability grew to $42 million, 2½ times its general fund budget. Standard & Poor’s says the city remains under financial pressure and rates its bonds at junk status.

• Monrovia. Standard & Poor’s sharply downgraded the city’s credit rating, citing a “substantially weakened general fund and liquidity position” coupled with the possibility it could lose pending litigation with a developer. It said the city’s general fund consisted “entirely of restricted and non-spendable assets.” Faced with declining tax and other revenue sources, the city cut staff 17% and reduced services, including street repaving, to balance its budget. Monrovia is 20 miles east of Los Angeles and one of several small cities along the foothills of the San Gabriel Mountains.

• Oakland. Plagued by high crime and lower revenue, this city on the east side of San Francisco Bay has cut police and other services while struggling to stay solvent. It has endured budget shortfalls of $318 million over the past six years and since 2008 has eliminated 16% of its workforce, or 720 jobs, while reducing pay and giving workers unpaid furloughs. Even with a recovering economy, the city is facing a $19 million shortfall in the coming year and projects a deficit of $35 million or more in 2015 as financial concessions made by public-employee unions expire and pension and retiree health benefits climb. The city has reduced its police force by 25% since 2009, to 626 officers, and the California Highway Patrol is helping police the city.

• San Jose. Being home to much of Silicon Valley’s tech riches has not spared the nation’s 10th-largest city from financial stress. The city has run 11 consecutive general fund deficits, and though it still has reserves, Standard & Poor’s downgraded San Jose’s credit rating in 2012 and branded it with a negative outlook, saying it still faces “long-term structural pressures.” The city has cut workers’ pay 10% and outsourced jobs but still foresees a $5.5 million deficit next year and nearly $14 million the year after. City officials say their biggest problem is retirement costs, which soared from $73 million in 2001 to $245 million last year. Cuts in public pensions approved by voters last fall are being challenged in court by unions. “Long-term budget obligations have outgrown the current revenue structure,” Standard & Poor’s said in January.

• Vernon. The smallest incorporated city in the state, with a population barely over 100, is an industrial center neighboring Los Angeles with 1,800 businesses and 55,000 jobs in 5 square miles. Vernon has a history of corruption and was the subject of a scathing report by the state auditor last July that said the city doesn’t have enough revenue to pay for the services it provides. The audit found Vernon operated with annual deficits in its general fund for more than 20 years, increasing spending and salaries while tapping dedicated funds, reserves, asset sales and other transfers. The audit said Vernon engaged in speculative investments without effective risk evaluation, including an “unreasonable” natural gas deal that has cost it millions. It cited loose contracting practices and found problems in 21 of 25 city contracts examined, including lack of competitive bidding. It said Vernon had weak internal financial controls and “may have provided legally questionable retirement benefits to certain current and past executives.” The city turned back efforts in the Legislature to disincorporate it last year and adopted reforms, but the auditor said some policy changes have not been implemented and others will take years to achieve. USA Today

Not far behind these ten are Chico, Oroville, Red Bluff, Marysville and Paradise. California now leads the nation in municipal bankruptcy filings. Stockton is the largest city yet to file for bankruptcy, marking a new low point in a trend sweeping California. Thank you democrats! Could you possibly be doing any worse?

Liberal democrats in Sacramento have single handedly taking the richest and most highly rated State down to it’s knees like a 3rd word country in the hands of a dictator. The policies of liberal democrats have ruined the State’s credit, ruined the school system, increased the drop out rate, raised welfare and more. Speaking of welfare did you know that California accounts for 32.62% of all the welfare rolls in the entire country? In 2013 we added an increase of 6.5%!

Democrats have forced on us the highest paid legislation in the nation, the highest paid state workers to be found anywhere, the worst performing legislature in the nation that must take full credit for chasing away businesses and jobs at a record rate. These fat cats in Sacramento have caused us to pay the most in taxes and get the least for it and they’re still raising taxes (see ACA 8).

Police and fire layoffs, bankrupt cities, failing schools, massive welfare, over regulation…none of this seems to matter to the voters of California, they voted the rascals in and they will re-elect them. That much you can count on! -Jack

http://www.norcalblogs.com/postscripts/2013/06/20/ten-california-cities-danger-bankruptcy/

Non sequitur. Nothing in this partisan hack's blog about individual cities' finances refute any of the metrics used in the OP to show California's economic comeback. In fact, the State's decreasing unemployment rate and increased property values will only fatten up the troubled cities' public coffers.

[spursncowboys]

Since California will get a bail out anytime they go under, it only makes sense for every tax payer to root for them.

[Th'Pusher]

Since California will get a bail out anytime they go under, it only makes sense for every tax payer to root for them.

A federal bailout? In what form do you see this bailout manifesting?

[spursncowboys]

A federal bailout? In what form do you see this bailout manifesting?

Same way all the other garbage is pushed down our throats.

[ElNono]

California made a great turnaround and still has ways to go. They obviously have a big advantage in the sheer size of their economy, something other States don't have, but if they can get the ball rolling, perhaps the rest of the country can pick up steam too.

[angrydude]

Instead of cranking out ridiculous straw, why not address the facts of the article...do you not agree with the metrics the author uses to measure success?

China' got 11.4% GDP growth. Clearly their economy is kickass and there is nothing wrong with it. The metrics don't lie.

The fact you don't understand how this relates to your argument shows how ignorant you really are.

That's an ad hominem.

[Rogue]

The economic size of Cali is about the same as the entire New England region, and would be the 12th largest economy in the world if counted as an independent country. The US can't afford to let Cali fail plain and simple so the feneral government will take every measure to keep the ship afloat (similar to the Most preferential treatment the Lakers often get from Stern).

[Twisted_Dawg]

I'm not so sure that all the Asians with money moving to California and buying real estate and work would be interested in doing the same thing in Illinois, Michigan, etc. California's recovery is spotting and located in the tech areas, San Francisco, and San Diego. The rest of the state is still struggling. The State is rated the worst when it comes to being business friendly and the highest state income tax in the country. California is one of the most beautiful states in the country, has incredible weather and I do hope it reaches full economic recovery for the entire state.

[CosmicCowboy]

I think we can all agree that " home prices were 28.3 percent higher in June than they were a year before" is an unsustainable aberration and more of a reflection on just how awful it got than how good it is now.

Another thing that confuses me about this article is this:

" California’s current unemployment rate of 8.5 percent is now ninth in the country."

If the national average is 7.6 how is this good?

[boutons_deux]

" California’s current unemployment rate of 8.5 percent is now ninth in the country."

If the national average is 7.6 how is this good?

good for CA comparing 8.5 to where CA was 3 or 4 years ago.

8.5 is about NINTH from the bottom

http://www.bls.gov/web/laus/laumstrk.htm

[admiralsnackbar]

California made a great turnaround and still has ways to go. They obviously have a big advantage in the sheer size of their economy, something other States don't have, but if they can get the ball rolling, perhaps the rest of the country can pick up steam too.

This. The economy in that state is monumental thanks to being the logistical hub of several nationally crucial industries. Where they continue to falter is at the legislative level, where an impossibly polarized Sacramento is either paralyzed by gridlock or spitting out inane partisan programs and taxing strategies. It seems to happen at the municipal level in mid-state cities, too.

Scroteface and others appear to be confusing state/municipal economics with commercial/industrial ones. The former needs the latter, but it also needs smarter, more cooperative legislators.

[Th'Pusher]

Same way all the other garbage is pushed down our throats.

TARP? You think this congress has the political will to pass any such legislation for troubled municipalities? I couldn't disagree more.

[boutons_deux]

TARP? You think this congress has the political will to pass any such legislation for troubled municipalities? I couldn't disagree more.

Congress doesn't GAF about troubled municipalities because those municipalities don't lobby/pay/corrupt Congress. And even if they did, they couldn't outbid the corrupt payments of the FIRE/UCA

[scott]

Is the economic state of a region the same as the fiscal state of a region?

[KingsFanWithoutName]

It's not as good as many would like you to think.




California, Illinois on Brink of Pension Crisis; New Actuarial Rules Will Force States to Admit Problems


Many states, especially California and Illinois, have had severe pension underfunding problems for many years.

However, new actuarial pension rules will finally force states to admit the problem. Thus, it should not be surprising that talk of "technical bankruptcy" and “service insolvency” is growing.

Here are some pertinent ideas from California on the Brink: Pension Crisis About to Get Worse



•Moody’s new credit standards for public pensions would nearly double the unfunded liabilities for state and local pension plans in California to $328.6 billion from $128.3 billion.
•California has the second lowest credit rating at Standard & Poor’s of all 50 states; Illinois now has the worst. Moody's new standards would drop the funded status of these plans to 64%, versus a previous estimate of 82%, the Center said.
•“By standard accounting methods, some state pension funds will run out of assets within as little as five years”
•New rules will lower expected rates of returns on their pension assets, instead of the often overstated returns they now use to paper over holes in their plans blown out by bad investments.
•Meredith Whitney says California is papering over budget holes with gimmicks, like raising taxes retroactively, pushing state expenses onto local towns and cities that can’t afford them, and underfunding their pension funds. "It’s so much worse than the rosy picture that the headlines suggest,” the CEO of Meredith Whitney Advisory group says.
•The Senate Joint Economic Committee reiterates what Whitney says. “Many states and localities have regularly skipped or underfunded contributions to pension plans,” the report said. “Over the past five years, state and local governments have underpaid actuarially required pension contributions by more than $50 billion. The worst culprit of all, Illinois, has underpaid its pension contributions to the tune of $28 billion over the past 15 years.”
•Illinois’ plan is just 44% funded, or 30% using “conventional accounting standards,” the Senate committee says. Los Angeles’ combined plans would fall from 77% funded to 50% funded.
•San Jose’s combined plans would fall from 75% to 60% funded.
•San Francisco’s combined plans would fall from 88% funded to 69% funded.

Trouble Will Escalate

Many California cities are in serious trouble, and that trouble will grow by leaps and bounds as soon as there is a significant stock market correction.

Pension plans typically assume 7.5% returns. That's not going to happen on a sustained basis with 10-year treasuries yielding close to 2%. Yet, any significant rise in bond yields will crush existing bondholders as well as wreak havoc in equities.

Moody's wants states to assume 5.5% returns, but even that is far too high. The stock and bond markets are now so bloated thanks to Fed bubble-blowing policies that 0-2% returns for a full decade is a distinct possibility. And not a single pension plan in the US is remotely prepared for such an event.


Read more at http://globaleconomicanalysis.blogspot.com/2013/06/california-illinois-on-brink-of-pension.html#6YVQVwseGzETEQKz.99

[TeyshaBlue]

Is the economic state of a region the same as the fiscal state of a region?

Nope. See California. lol

[Th'Pusher]

Is the economic state of a region the same as the fiscal state of a region?

Excellent distinction. Posters who've demonstrated they're incapable of making that distinction:

scroteface
angrydude
antichrist (DarrinS)
boobie4three
kingsfanwithoutname (TSA)

:tu

[dbestpro]

After reading everone's quotes it seems California is not so much on a road to recovery, but rather they just are not sucking as badly at some things.

[KingsFanWithoutName]

Excellent distinction. Posters who've demonstrated they're incapable of making that distinction:

scroteface
angrydude
antichrist (DarrinS)
boobie4three
kingsfanwithoutname (TSA)

:tu

It would be foolish to look at one while ignoring the other.

[Th'Pusher]

After reading everone's quotes it seems California is not so much on a road to recovery, but rather they just are not sucking as badly at some things.

Wow. Even after the distinction between economic and fiscal health, Conservatives are still unable to bring themselves to admit that California's ECONOMY is recovering.

Who knew a state could be so polarizing...

[Th'Pusher]

It would be foolish to look at one while ignoring the other.

Sure, if you're able to show a relationship between the two. You did not even appear to be able to make the distinction.

[ElNono]

What state doesn't have fiscal liabilities up the wazoo?

Even 'fiscally conservative' Texas has more debt accumulated than California...
http://www.city-journal.org/2013/23_2_snd-texas-debt.html

California has the problem that some of that debt is due sooner, but that's where a healthy economy helps them.

[angrydude]

Wow. Even after the distinction between economic and fiscal health, Conservatives are still unable to bring themselves to admit that California's ECONOMY is recovering.

Who knew a state could be so polarizing...

God you are so stupid.

What the hell does a recovery mean to you?

That GDP is going up? Or that the fundamentals of the economy are improving? They are not the same thing.

The "growth" is all illusory, and will implode at the first sign credit is drying up again.

But hey, lets focus on overly simplistic headline numbers and sweep the rest under the carpet.

[TeyshaBlue]

What state doesn't have fiscal liabilities up the wazoo?

Even 'fiscally conservative' Texas has more debt accumulated than California...
http://www.city-journal.org/2013/23_2_snd-texas-debt.html

California has the problem that some of that debt is due sooner, but that's where a healthy economy helps them.

If the choice is between muni/school bonds and unfunded pension liabilties, I'm going with muni bonds.

[ElNono]

If the choice is between muni/school bonds and unfunded pension liabilties, I'm going with muni bonds.

Some peeps here talk like this debt liability is static, but debt gets restructured all the time. The whole point is that it's much easier to restructure when you have a vibrant, growing economy. When you compound the fiscal problem with a shitty economy you end up like Detroit, where people simply flee.

[boutons_deux]

If the choice is between muni/school bonds and unfunded pension liabilties, I'm going with muni bonds.

then TX should quit lying to employees than their pension agreements will be honored.

in RI:

"when Central Falls filed for bankruptcy protection in 2011,” the Pew report said. It recounted the Chafee administration’s appointment of state receivers who took over city government, cut budgets, raised taxes and gutted pensions while the General Assembly guaranteed investors their bonds would be paid in full."

http://www.providencejournal.com/breaking-news/content/20130724-pew-study-looks-at-how-r.i.-handled-bankruptcy-of-central-falls.ece

"In Rhode Island, Sasse explained, state law protects bondholders in the event of a municipal bankruptcy. And that’s exactly how it played out when the small city of Central Falls, R.I., passed through bankruptcy in 2012. City employees and pensioners were hit hard, forced to renegotiate existing and past contracts. But the city never missed a payment on its general obligation bonds.

“The first thing that needs to be done is to achieve a balance between the bondholders and city employees.”
- Gary Sasse, municipal finance expert


Sasse said protecting bondholders is critical to protecting the financial reputation of the city in question, as well as other municipalities in the state and the state itself. If that reputation becomes tarnished and investors lose faith in a city’s ability to repay its debt, it could have a contagious effect on the rest of the state."


Read more: http://www.foxbusiness.com/government/2013/07/19/bondholders-pensioners-seeking-balance-in-detroit/#ixzz2ZzbEwxEV


bondholders paid off, employees fucked.

Contracts with the (1%) bondholders are honored, contracts with the 99% are worthless.

[CosmicCowboy]

Some peeps here talk like this debt liability is static, but debt gets restructured all the time. The whole point is that it's much easier to restructure when you have a vibrant, growing economy. When you compound the fiscal problem with a shitty economy you end up like Detroit, where people simply flee.

It wasn't debt that killed Detroit...First it was white flight to the suburbs and then working class black flight to the suburbs leaving the city to the wretched, drug and crime ridden underclass. It wasn't debt that killed Detroit, it was their tax base leaving to get away from the inner city animals.

[TeyshaBlue]

Some peeps here talk like this debt liability is static, but debt gets restructured all the time. The whole point is that it's much easier to restructure when you have a vibrant, growing economy. When you compound the fiscal problem with a shitty economy you end up like Detroit, where people simply flee.

Absolutely. Now stop arguing with me and get to work!:flipoff

[TeyshaBlue]

then TX should quit lying to employees than their pension agreements will be honored.

in RI:

"when Central Falls filed for bankruptcy protection in 2011,” the Pew report said. It recounted the Chafee administration’s appointment of state receivers who took over city government, cut budgets, raised taxes and gutted pensions while the General Assembly guaranteed investors their bonds would be paid in full."

http://www.providencejournal.com/breaking-news/content/20130724-pew-study-looks-at-how-r.i.-handled-bankruptcy-of-central-falls.ece

"In Rhode Island, Sasse explained, state law protects bondholders in the event of a municipal bankruptcy. And that’s exactly how it played out when the small city of Central Falls, R.I., passed through bankruptcy in 2012. City employees and pensioners were hit hard, forced to renegotiate existing and past contracts. But the city never missed a payment on its general obligation bonds.

“The first thing that needs to be done is to achieve a balance between the bondholders and city employees.”
- Gary Sasse, municipal finance expert


Sasse said protecting bondholders is critical to protecting the financial reputation of the city in question, as well as other municipalities in the state and the state itself. If that reputation becomes tarnished and investors lose faith in a city’s ability to repay its debt, it could have a contagious effect on the rest of the state."


Read more: http://www.foxbusiness.com/government/2013/07/19/bondholders-pensioners-seeking-balance-in-detroit/#ixzz2ZzbEwxEV


bondholders paid off, employees fucked.

Contracts with the (1%) bondholders are honored, contracts with the 99% are worthless.



lol...now fox is credible. Although, this reminds me of the GM bankruptcy settlement.

[ElNono]

It wasn't debt that killed Detroit...First it was white flight to the suburbs and then working class black flight to the suburbs leaving the city to the wretched, drug and crime ridden underclass. It wasn't debt that killed Detroit, it was their tax base leaving.

If people had jobs, they would stick around. The problem was that there were no jobs there. Detroit has gone on an unemployment spike since the early 2000s, with a peak of 27% in 2009. Still at 16% today.

Here's compared with Chicago:
http://www.google.com/publicdata/explore?ds=z1ebjpgk2654c1_&met_y=unemployment_rate&hl=en&dl=en&idim=city:PS260250:PS170100&fdim_y=seasonality:U

[TeyshaBlue]

If people had jobs, they would stick around. The problem was that there were no jobs there. Detroit has gone on an unemployment spike since the early 2000s, with a peak of 27% in 2009. Still at 16% today.

Here's compared with Chicago:
http://www.google.com/publicdata/explore?ds=z1ebjpgk2654c1_&met_y=unemployment_rate&hl=en&dl=en&idim=city:PS260250:PS170100&fdim_y=seasonality:U

Man, that's brutal.

[boutons_deux]

lol...now fox is credible. Although, this reminds me of the GM bankruptcy settlement.

so you think foxBUSINESS is lying about those facts?

[exstatic]

I love it when conservatives get angry when California does well.