California Collapsing

California Collapsing

www.moneyandmarkets.com

Washington and Wall Street seem to be treating California as if it were a sideshow in the financial circus of these turbulent times.

It’s not.

California is home to the largest manufacturing belt in the United States and to Silicon Valley, the nation’s largest high-tech center.

California is America’s most populous state with 38 million people. Its GDP of $1.8 trillion is the largest in the U.S. Its economy is bigger than those of Russia, Brazil, Canada, or India.

And it's collapsing.

(visit the link for the full news article)

Major California counties are ground zero in the continuing mortgage meltdown:

Los Angeles County with 5.32 percent of mortgages 90 days past due … Monterrey County, 8.02 percent … Imperial, 8.13 … San Bernadino, 8.66 … Madeira, 9.21 … San Joaquin, 9.53 … Riverside, 10.2 … Merced, 10.57 … and more!

California’s inventory of foreclosed homes is skyrocketing. Home prices are plunging. And the impact of surging unemployment is just beginning to show up in the data …

Worst Unemployment in 64 Years

...snip...

My recommendations:

1. If you wait for Moody’s or S&P to act, it could be too late. Even if you can’t get what you might consider a good price, sell all California paper now!

2. Seriously consider dumping all tax-exempt bonds. I know the income is better than equivalent Treasuries. But if California defaults, it could set off a chain reaction of bond price plunges and defaults throughout the municipal bond market.

3. Don’t underestimate the impact California’s depression is having — and will continue to have — on the rest of the U.S. economy. At $1.8 trillion, the state’s GDP is so large, any further deterioration could wipe out every so-called “green shoot” in the national economy seen to date.

4. Stay safe, with a big portion of your nest egg in cash, tucked away in short-term Treasury bills … and with a very modest portion in gold, as an insurance policy against a dollar decline.

Good luck and God bless!

Quite contradictorily to what Bush said that would happen.



It's not the first time that California is said to be in one of the worst states in America, but it's gradually becoming more apparent that California might very well be the first state to collapse.

This system is rotten to the bone and unfortunately for the world, everyone is going down due to the increased globalization.


www.moneyandmarkets.com
(visit the link for the full news article)

[edit on 1-7-2009 by Mdv2]

Good.

Further proof entitlement programs do not work, and do not benefit anyone other than parasites.

Add in the irresponsibility of its elected officials, and it was only a matter of time.

I for one am happy to see the socialist republic of California collapse.

Further proof entitlement programs do not work, and do not benefit anyone other than parasites.

Add in the irresponsibility of its elected officials, and it was only a matter of time.

I for one am happy to see the socialist republic of California collapse.

Now we're gonna test that on the national level... it's gonna be hellish.

Not to mention the ``green jobs`` BS.. Spain tried that... now they have 20% unemployment.

California Collapsing has been a long time democratic party project.

There Utopian views of no industry, logging, mining. and power plants ECT ECT ECT has stripped the state of its main tax industries.

People flipping burgers do not pay taxes anywhere near people working in industry.
So the higher tax payers have left the state in large number fallowing the jobs and the burger flipper are now the largest tax base.

Actually, I live in California and do not feel this occurring. Mortgage companies are working with homeowners that qualify for resetting of mortgages. Some incomes are diminished and do not qualify.

unemployment rates are there, but so are jobs. I know of at least one person on unemployment who is able to work, but is looking for a better job.

Entitlements have been reduced slightly for the handicapped, but the Federal supplement has compensated somewhat for it.

All in all, we are in a transition. However, don't overlook all the retirees, seniors on Medicare, and high rollers in California. There's plenty of money out here. I'm in sales, and it just depends on how hard you want to work to get it.

Salespersons will drive the economic recovery. If we have enough high quality salespersons, things will rapidly return to better times.

Health Net raised my insurance rates by 33%. Doesn't sound like they're hurting much, either. The health industry seems to be going strong here.

There are more on unemployment that the records indicate, as the records do not track unemployment of commisson-only jobs. I know a few people who are commission types, like me, and they are in a pinch. However, there are lots of sales jobs looking for workers. Most folks don't want a commission job.

I have been talking about this for some time now. This is exactly what I saw coming down the pike in September. Now, with that said, please listen closely, by the end of this year this will have spread to 20 other states or so. Congress may be forced to have the Federal Reserve issue bailouts to states in printed money forcing the credit rating agencies to move the Federal Rating down several notches as well.

After the Federal credit rating gets dropped it will cost A LOT more in interest for the US government to borrow money, this will in turn force the treasury to monetize the debt causing rampant or hyperinflation, or a US Federal Government default. This isn't an effing game anymore. The corrupt a-holes in Washington have addressed NOTHING fundamental to the reform and recovery of the national Economy. We have spent 14 trillion or so with several trillion in the works for energy and health care, plus Cap and Trade-the largest tax in history, as the polluters that it is meant to punish, will pass on to the consumer forcing inflation up higher. especially in food, energy and fuel costs.

The bottom is about to be blown out of the American empire, and Congress, the Federal Reserve and their bankster friends will be laughing all the way to the bank as the rest of us become destitute. THIS is why I pay attention to policy and ACTIONS. Not words, and not rosy feelings.

The majority of the nation is too complacent to give an effing crap about anything other than their distractions to worry about the destruction of their ability to be distracted. What Irony. At this point the blame lies square on the Masses, who so blindly step into the bliss of ignorance without even the most minimal of protest. It is a brilliant plan if I've ever seen one, or it is the largest exercise in collective stupidity in the history of human kind.

That is an awesome post above me. I encourage everyone to read it twice for full understand

As a Californian I am very worried, BUT I hope the state goes bankrupt, or better yet the people revolt and every darn politician dem or rep gets kicked out of office.
CA is whack...as a previous poster said, they want no industry, powerplants, refineries, mines, etc. Do you know how much gold is left in the hills around CA!? We could be well off if we could mine....Remember those blackouts we had several years ago? Just try and build a power plant, in a timely manner, with all the dirt worshiping greenies around here. Our gas costs 30 to 50 cents more per gallon because of stricter standards, and the oil must be refined here...and yet WE HAVE NOT BUILT A NEW REFINERY IN 30+ YEARS!
Our roads are in shambles, but drive over to Nevada and everything looks great....just ask projectvxn, at least interstate 80 always looks better on the nevada side than the CA side

We have too much bureaucracy...there is a website somewhere of hundreds of little organizations, boards, associations, etc run by the state and I can guarantee you the people working for these or on the board of directors are making $100,000+ a year, plus our state legislature is the highest paid in the nation, even after a 10% pay cut!
If the median household income is only approx 60K [probly more like 50K] then why should representatives make more than double than that of their constituents? It makes no sense, no one should get rich in politics. The CA state government needs to be restructured, BAD. Pay the politicians 75K a year or less, eliminate most of these programs and for peets sake eliminate some of this spending!



[edit on 7/1/2009 by AnonymousMoose]

[edit on 7/1/2009 by AnonymousMoose]

i will have to say that the 4th of july weekend will be marked by small but undeniable signs of the coming social meltdown. Mark this post

btw,
I really like the idea of paying politicians what the median income is in there district. Thats a great idea

[edit on 1-7-2009 by Spartak_FL]

reply to post by projectvxn


To all you who think California is some sort of socialist welfare state, what world do you live in?

For all your socialism blather, you sure seem happy to live off our dime: California gets about $ .75 back on each tax dollar we send to Washington. We're supporting your disrespectful butts, and getting pretty tired of it. I can't imagine how much we send to the New York banksters each year.

We've had Republican governors for quite awhile now, their fiscal policies have driven down the quality of education statewide, made a lot of peole homeless, and cost huge numbers of jobs. They've allowed corporate ripoffs left and right, just like everywhere else. If this is socialism, it sure looks a lot like conservative capitalism to me. We've been bled dry by successive frauds like Enron: my monthly electric bill hit $745 during the height of the crisis, after we cut usage by 35-40%. I've never recovered a dime of what was extorted then. Corporate America likes to charge us extra for everything: a sun tax for the privilege of living here. Gas were I live runs about $3.00 a gallon today, last year it hit $4.52 in some spots. We, the people of California, are pretty fiscally frugal in our own lives, we have to be: wages are low compared to the cost of living. If I'm living in a socialist paradise, nobody's told me about it, and I've never seen it.

My county supervisors just finished wasting several years and millions of taxpayers money unsuccessfully fighting state law about medical marijuana. Does that sound socialist to you? The strongest union in the state is not the teachers' union, nor a labor union, but rather the prison guards union. I guess that's socialist, too.

Someone suggested that what we need is our own state bank, so we can issue credit backed by our tax receipts, and quit paying interest to New York. I'm all for that.

Regardless, we're screwed now.

And guess what?

You're screwed, too.

Because we've been supporting the rest of the country, and we can't afford it anymore.

reply to post by AnonymousMoose


Indeed. I make incursions into California every so often...It's almost like stepping into a different nation... There is so much untapped potential in California it isn't even funny...Even though things might seem better in Nevada, it isn't rosy here either. Reno and Vegas have been hit hard by unemployment. Reno has just stopped hiring altogether. There are many homeless people on the streets here. The state is facing a 1.5 billion dollar shortfall, and with the smallest government this side of the Mississippi, that is a HUGE problem...As their isn't much to cut. This is a domino effect. And even cap and trade won't fix the revenue shortages that the Federal government is about to face. Even if they taxed everything 100 percent.

reply to post by apacheman


I don't remember posting anything about socialism. I'm addressing technical problems which have been heavily marred by decades of mismanagement. The chickens are coming home to roost, no matter how much one wants to babble on about politics. Political ideology is not technical, it is a religion, a dogma. I've spoken of no such thing. I didn't say republican or democrat, I didn't say Conservative this, Liberal that or even mentioned Libertarians.


It is no longer about this kind of BS political back and forth. I said it in that post before, it isn't a game any more. I also made a point to mention that this is going to be a national thing. We're all in this snowballing mess. No reason to fuel anxiety with useless politics.

Hmmm...could be seeing a reverse of the "Grapes of Wrath" type scenario... Please, for the love of all that's good and holy, don't come BACK to Oklahoma.

Our state is doing pretty good, and we don't need morons who will pay $500,000 for a home that's only worth $100,000 driving up our cost of living.

Originally posted by apacheman
reply to post by projectvxn

 

To all you who think California is some sort of socialist welfare state, what world do you live in?

For all your socialism blather, you sure seem happy to live off our dime: California gets about $ .75 back on each tax dollar we send to Washington. We're supporting your disrespectful butts, and getting pretty tired of it. I can't imagine how much we send to the New York banksters each year.

We've had Republican governors for quite awhile now, their fiscal policies have driven down the quality of education statewide, made a lot of peole homeless, and cost huge numbers of jobs. They've allowed corporate ripoffs left and right, just like everywhere else. If this is socialism, it sure looks a lot like conservative capitalism to me. We've been bled dry by successive frauds like Enron: my monthly electric bill hit $745 during the height of the crisis, after we cut usage by 35-40%. I've never recovered a dime of what was extorted then. Corporate America likes to charge us extra for everything: a sun tax for the privilege of living here. Gas were I live runs about $3.00 a gallon today, last year it hit $4.52 in some spots. We, the people of California, are pretty fiscally frugal in our own lives, we have to be: wages are low compared to the cost of living. If I'm living in a socialist paradise, nobody's told me about it, and I've never seen it.

My county supervisors just finished wasting several years and millions of taxpayers money unsuccessfully fighting state law about medical marijuana. Does that sound socialist to you? The strongest union in the state is not the teachers' union, nor a labor union, but rather the prison guards union. I guess that's socialist, too.

Someone suggested that what we need is our own state bank, so we can issue credit backed by our tax receipts, and quit paying interest to New York. I'm all for that.

Regardless, we're screwed now.

And guess what?

You're screwed, too.

Because we've been supporting the rest of the country, and we can't afford it anymore.

The problem isnt with how much the federal government spends on you . The problem is how much YOU spend on YOURSELVES.

I live in florida. The state has 0 I repeat, ZERO income tax. What does Cali pay? 15%?. I pay the state of florida NOTHING out of my paycheck. We rebuild after every hurricane, we still get unemployment when needed, we have medicaid and always have a balanced BUDGET. Nobody is starving or being kicked out of hospitals in florida. There arent mass riots.


And guess what, the recession has hit us almost as bad as it has hit you. Why are we so much better off than CA? Simple. We are not stupid. We have a responsible government. We dont send idiots like Pelosi or Waxman to congress and sure as hell dont elect those who dont have our interests in mind.

And we are all republican down the line when it comes to state government. We loved Jeb Bush. He was Governor for 2 terms



Stop being partisan. California is in its own mess because it created it. It knows what it needs to do to solve it. Cut bullcrap spending. All of it.


man i really need a new keyboard i hate this thing.

[edit on 1-7-2009 by Spartak_FL]

copied from another thread





This video was made in 2008. There are now 33 known camps across the state with estimated over 40,000 occupants and growing daily.

Just think if California didnt spend 5.53 billion dollars a year on social services for illegals these people could all be housed. You made this bed.

[edit on 1-7-2009 by Spartak_FL]

Originally posted by randyvs
reply to post by projectvxn

 

blah blah blah 1st line. you can stop w/ the reposts.

nice contribution you have made to this thread.

I'll never understand why Republicans don't like California -- other than Cali's progressive social views.

California is a much bigger economic entity than Florida. In fact, it's the 10th largest economy in the world.

How on earth does the 10th largest economy in the world go bankrupt? I guess not saving enough, spending too much? I don't really know -- but it's going to be very difficult for them to get enough credit to stay afloat, considering the amount they need relative to their size.

[edit on 1-7-2009 by Kaytagg]

Originally posted by Kaytagg
I'll never understand why Republicans don't like California -- other than their progressive social views.

California is a much bigger economic entity than Florida. In fact, it's the 10th largest economy in the world.

How on earth does the 10th largest economy in the world go bankrupt? I guess not saving enough, spending too much? I don't really know -- but it's going to be very difficult for them to get enough credit to stay afloat, considering the amount they need relative to their size.

Governments should never save money. Since government are not in the business of selling a product any money overcharged to the taxpayer should always be returned.


And a comparison can be made. Its GDP is the fourth largest economy in the United States and also Florida has the 4th highest state population in the United States.

The reason is policy. Florida isnt nearly as resource rich as Ca is. But we have a sane fiscal policy. Yet still we are 3rd inline to be hit worse by the recession. Behind Michigan and California. But we dont pay state income taxes so that says alot. If we really needed to, we could do that in the event of a emergency.



[edit on 1-7-2009 by Spartak_FL]