Stockton, CA: The first domino?

news.yahoo.com...

The city of Stockton, California, is eligible for bankruptcy protection, a federal judge ruled on Monday, turning aside creditors' arguments that the city was not truly insolvent when it sought protection and had improperly failed to seek concessions.

U.S. Bankruptcy Court Judge Christopher Klein's ruling permits Stockton to proceed with its Chapter 9 bankruptcy protection filing from last June in a case with precedent-setting potential for other cash-strapped U.S. cities.

This is BIG in my opinion. The precident has now been set... large municipalities may file for Chapter 9 protection. Ultimately this means that a number of currently floundering cities will almost certainly file for these protections, such as Harrisburg, PA, Detroit, San Bernadino, even Las Vegas and Reno, NV. The end result to all of this will NOT be a trimming of municipal spending. If US history (especially in this recent era of Meal Ticket supporters) is any indication, the higher borrowing costs will be but a minor inconvenience to these cities. They will turn to the majority of their voter base, those with much less skin in the game, and ask for votes approving high interest bonds and jacked up property and luxury sales taxes. The voters will hand the knife over and stand their stupidly as their government slices it across their own throats, destroying the cities and then stampling down on the tattered remains until there is nothing left but those who cannot afford to move to greener pastures.

reply to post by burdman30ott6


I think it was San Bernardino, CA that was the first to fall.

reply to post by burdman30ott6


What about a country wide reset? We would assess all foreign debts as whatever is stable value wise.. We could owe them in water or oil or something (the countries owed could then later say we owe them in their own currency valued at the same price as the oil).. Then we just cancel all internal debts and say tough luck to any one owed money inside.. Then loan out new money to anyone who wanted it, or had nothing to trade in for it.. It would be loaned out at a very small percentage like .3% apr.

I mean I know I don't really get the whole thing, but it seems more peaceful than world war and no one working... Sure many would lose a lot of savings and whatever else..

I don't know.. It's always been a fantasy of mine..

Originally posted by Dustytoad
Then loan out new money to anyone who wanted it, or had nothing to trade in for it.. It would be loaned out at a very small percentage like .3% apr.

Where will the money to pay for the .3% come from?

You just re-invented the beast.

Originally posted by ErgoTheConclusion

Originally posted by Dustytoad
Then loan out new money to anyone who wanted it, or had nothing to trade in for it.. It would be loaned out at a very small percentage like .3% apr.

Where will the money to pay for the .3% come from?

You just re-invented the beast.

true.. I just couldn't see people(who would value/print the money) understanding debt free money..

But yes good catch.

The only workable long-term solution would be to cancel and forgive ALL debt. That would include private, consumer, industrial, student, local, city, county, state, and national debts. Our current financial situation is the inevitable result of a debt-based economy, which (by design) lacks the money to pay back the debt. If the debt cancellation/forgiveness could be made world-wide, it would be even better.

Correct me if I am wrong but all the city Pensioners get in line with the rest of the creditors for their 10 cents (?) on the dollar when Chapter 9 is filed.... If true "That will hurt".....as much worthless Fiat money as the Fed is printing maybe they should just run the presses a couple of extra hours this month and pay down their debt.....oops they are running full speed ahead now, no?

None of us that I know of have a crystal ball that works but I do not see how some of the cities along with their obligations are going to remain solvent without raising taxes on everything....... thus driving out/away their tax base in a never ending cycle that is heading for the dust heap. The more they take the more they waste and want.

I grew up in Stockton and my father has worked for city municipals for about 30 years now. He has been actively involved with this situation as it greatly affects him and his retirement. The issue with Stockton came about when the illegally privatized certain municipalities in order to fund their downtown revitalization project which included a state of the art baseball stadium on the waterfront and a huge event center as well as other improvements. Finally the privatization was overturned but now the city is attempting to completely screw their employees. There has been an abundance of crookery going on within the city government for the past decade and probably longer. Add to that how hard Stockton and San Joaquin Valley was hit when the housing bubble burst, one of the worst hit areas in the country, and now city officials are frantically trying to keep things afloat. It's an insane chain of events and it happens to hit squarely at home for my family. Luckily my parents have always made sound financial decisions, otherwise their future could be very bleak. My father has worked extremely hard and it makes me very angry that they are now trying to cheat him out of what he earned. I do believe other cities will be affected in the same ways and it spells trouble for everyone who relies on municipalities which is most people! Good post OP

reply to post by burdman30ott6

Wont be the first place to declare bankruptcy, or chapter 9.

As more towns, municipalities, cities, counties and states collapse, people will stop buying their bonds and their funds will dry up.

At some point, they are going to have to CUT SPENDING. Lifelong benefits on the tax payer's dime are a thing of the past.

Politicians are a fail on every level, state, federal, doesnt make any difference.

reply to post by Lazarus Short


Yes and there is no reason why this has not been done.
Forgiving debts of other country's has been done often
Why not here aqt home ?

Unless you include all debt including all these generous pensions for police and government workers, you will move nowhere. Some are making 100K and more a year, some slightly less, but nearly what they made while employed. It's simply unsustainable.

reply to post by burdman30ott6


If from the very beginning our forefathers had followed God's Sacred Laws provided in those Laws and Ordinances was a Ordinance just for this which was the "Ordinance of Jubilee" if memory in my elderly years does not fail me where every so many years ALL DEBTS across the entire land were FORGIVEN so everybody including the very poor could have a fresh and clean start so they could hopefully do better in the future. This is the state our union is in today for FAILING to remember God's Eternal Love for us all in setting up a right and true set of governing Laws and Ordinances long ago. We reap what we sow. So be it. Our Sins are on our own heads of this nation and God will judge this nation as all nations righteously come that day to come. Amen.

Well, that's some hope and change we have ourselves at this point. I Pray for the people of stockton. I truly do. I was in and out of that city many times in the truck, given how it sits just east or north of the main California produce fields and production centers. Good people...and I've watched the stories of Police layoffs, reduction in what they'll come out for in calls for help and assistance drop story after story. Year after year.

This one isn't Obama, beyond the national climate, but the climate sure isn't helpful. No, I give credit 100% to Governor Moonbeam for this one. They willingly and knowingly re-elected the man who ran California into the dirt under Jimmy Carter. What did they expect was going to happen from that decision? It's as if folks see absolutely no cause/effect between who is elected and what happens next.

The only thing Jerry Brown hasn't repeated are the massive aerial bombardments of Malathion poison all over state residents. Or has he? I haven't kept up on that....but that was what I recall him best for, as a little kid who didn't pay attention to the political horror show of that man running a state back then.

My thoughts go out to Stockton though..... It had become a dangerous dangerous city before this. Now? Well, I just hope they come through it better, some day.

reply to post by azureskys


Major countries exporting to US have built reserves of US dollars or US assets (bonds mostly).

The reserves are built for a rainy day. If the bonds go for a toss, so will go US ability to import stuff, as foreign nations would not know what to do with excess dollars.

So it is more complicated than it seems.

I see Cyprus model applied first. The domestic savers are the ones to face the gauntlet first.

Paying huge salaries to city managers is a waste of the taxpayers of the cities moneys. Paying high wages to any city official is dumb. We can get retired people to be mayors and councilmen for almost nothing. Giving city workers great retirement benefits is also a problem since the expenditure has been pushed on the future and not paid for at all. As more and more people retire the amounts of the benefits and retirement become excessive. Pretty soon there is a third of the budget obligated to benefits and retirement. This is bad.

some local cities with a couple of thousand houses and businesses are paying a hundred grand for a city manager. Why do these communities need a city manager when a while back they were even bigger and they worked well with a Mayor. Add the retirement and benefit package to this wage and it tops 130 grand. Think how much can be done for this money in the community. You do not need a City manager to get federal and state funds when there is no federal and state funds available. Maybe if the city didn't have to pay for the city manager they wouldn't need state funding in the first place. I can see a big city needing one, but cities under ten thousand residents don't need one. Get a good mayor and elect responsible people to the council.

Get rid of funding in these cities for beautification commitees and promote community involvement to do things. Get some retired masons and construction workers to build that park building and use donations to fund it from local businesses and people. It doesn't cost that much if the work is done for free. Get some teens involved and help them learn something new from the experience of the old. Get rid of liability against volunteers but have someone overlook their work. Old construction workers know most of the codes, there are building inspectors to overlook these projects as they are being built.

The government has created rules to make sure that their kind are working. That is all right I suppose, someone needs to watch over us. The problem is that the rules are getting out of hand. I would never want to be tripping over ropes and wearing clumsy harnesses on a roof. Not everyone belongs on a roof, the ones that can handle it have good balance. I spent a lot of times on a roof when I had good balance, I loved roofing. Some people are good roofers, some are good soldiers, some are good at running a cash register in a store, while others are good cement workers. You cannot usually make a good cashier out of a mason and a cashier may not be able to lay cement adequately. One job does not fit all. But there is no problem with having a concrete mason on the city council as long as his association doesn't cause rules formed to promote more concrete.

Now that I have run off topic I guess it is time to move along to the present world again. Leaving the rational world where a community is the people, not of the people.

There seems to be this drive to create these entertainment places all over the continent....
Huge stadiums and baseball facilities as well as convention centers etc.
My question is
WHO will have to money to attend?
How are all these city facilities gonna stay filled with revenue producing acts when the economy cannot sustain the nessessities never mind the frills....???
City managers should have their asses kicked.
They all tried the same crap to revitalize and its a flawed model....
Should have looked for industry instead of baseball.....duh

Originally posted by GargIndia
reply to post by azureskys

 

Major countries exporting to US have built reserves of US dollars or US assets (bonds mostly).

The reserves are built for a rainy day. If the bonds go for a toss, so will go US ability to import stuff, as foreign nations would not know what to do with excess dollars.

So it is more complicated than it seems.

I see Cyprus model applied first. The domestic savers are the ones to face the gauntlet first.

You know, it's really worse than that and I just want to scream my lungs out when I hear people suggest forgiving 17 trillion dollars in national debt or somehow erasing it like it never happened.

JUST over 5 trillion of that is held by foreign national Governments and official sources. 5 trillion ...out of 17 trillion. 12 trillion or so of what remains is private debt. That *IS* Cyprus in so far as it being Bonds, Treasury notes, T-bills (They are accounted differently..even if very similar) and a number of other things held by normal, average working Americans or pension and retirement funds.

Erasing the national debt means utterly destroying a good % of the American public who have saved or vested anything in retirement savings or retirement plans, overnight. Bam... Equality? OH YEAH.. That would get equality alright. We'll all be equally poor and headed for grinding poverty as even those who could retire without sucking every last benefit the Government can provide ...would lose any chance of ever doing it.

I don't get it. Why does almost no one on this forum talk about the Federal Reserve when it comes to the economic collapse? Sure, if you slice off everyone's debt off that's fine, but what's creating the debt in the first place?

The Federal Reserve is a private central bank that controls the money supply of the US. If that does not seem hypocritical or laughable to you immediately than... yeah. Seriously, this is hilarious. One of the primary reasons of the Revolution was British Central Bank power over the Colonies Economy.

One of the main reasons why the Federal Reserve fails the American people is with this Central Banking system, the Government lets the Federal Reserve create money out of thin air, then the US Government borrows that money.

And of course, the US Government will return eventually to the Federal Reserve again and again to borrow money for the preposterous amount of debt being built up because of this Roman 2.0 Empire that's being built.

It's an endless spiral of debt and it enslaves us all unfortunately. Now I finally realize why people think inflation is normal. It's because with the Federal Reserve system, the money supply keeps expanding no matter what, it's an endless debt machine.


Well anyway, I want to end this post with some various quotes from various people on the Federal Reserve and banking.

"The Federal Reserve system pays the U.S. Treasury 020.60 per thousand notes --a little over 2 cents each-- without regard to the face value of the note. Federal Reserve Notes, incidentally, are the only type of currency now produced for circulation. They are printed exclusively by the Treasury's Bureau of Engraving and Printing, and the $20.60 per thousand price reflects the Bureau's full cost of production. Federal Reserve Notes are printed in 01, 02, 05, 10, 20, 50, and 100 dollar denominations only; notes of 500, 1000, 5000, and 10,000 denominations were last printed in 1945." —Donald J. Winn, Assistant to the Board of Governors of the Federal Reserve system

"The few who understand the system, will either be so interested from it's profits or so dependant on it's favors, that there will be no opposition from that class." — Rothschild Brothers of London, 1863

"Most Americans have no real understanding of the operation of the international money lenders. The accounts of the Federal Reserve System have never been audited. It operates outside the control of Congress and manipulates the credit of the United States" — Sen. Barry Goldwater (Rep. AR)

"This [Federal Reserve Act] establishes the most gigantic trust on earth. When the President [Wilson] signs this bill, the invisible government of the monetary power will be legalized....the worst legislative crime of the ages is perpetrated by this banking and currency bill." — Charles A. Lindbergh, Sr. , 1913

"From now on, depressions will be scientifically created." — Congressman Charles A. Lindbergh Sr. , 1913

"We have, in this country, one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board. This evil institution has impoverished the people of the United States and has practically bankrupted our government. It has done this through the corrupt practices of the moneyed vultures who control it". — Congressman Louis T. McFadden in 1932 (Rep. Pa)

"The [Federal Reserve Act] as it stands seems to me to open the way to a vast inflation of the currency... I do not like to think that any law can be passed that will make it possible to submerge the gold standard in a flood of irredeemable paper currency." — Henry Cabot Lodge Sr., 1913

"A great industrial nation is controlled by it's system of credit. Our system of credit is concentrated in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated governments in the world--no longer a government of free opinion, no longer a government by conviction and vote of the majority, but a government by the opinion and duress of small groups of dominant men." — President Woodrow Wilson

"I believe that banking institutions are more dangerous to our liberties than standing armies. Already they have raised up a monied aristocracy that has set the government at defiance. The issuing power (of money) should be taken away from the banks and restored to the people to whom it properly belongs." — Thomas Jefferson, U.S. President.

"History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling money and it's issuance." — James Madison

"Bankers own the earth. Take it away from them, but leave them the power to create money and control credit, and with a flick of a pen they will create enough to buy it back." -Sir Josiah Stamp, former President, Bank of England

reply to post by Kang69

Keep in mind, the Federal Reserve Bank's Chairman is appointed by the President of the United States and then confirmed by the US Senate, just like a Cabinet position in the executive branch.

It's true the Fed is a Private Bank....but then, no, it's not. It's an odd little limbo-land they exist in. Congress could outright demand an audit on any private organization in the world that does major business, let alone is based in the United States. See what happened when they tried it with the Fed?? They got told to stuff it and left with no options for how to force it. That isn't the mark of a private anything ...

So they exist in the private world for all that benefit, are appointed leadership by the Government and enjoy the protections of being a full Government agency.

Great gig isn't it? Private citizens can't touch them because they are Government. Government can't touch them because they are Private ...and they keep merrily re-appointing the same screw ups to run it. Bernanke was appointed by Bush and RE-appointed by Obama.

We have the Fed the Governments (both) of the last 15 years have chosen for us to have.

reply to post by burdman30ott6

interesting info, however i've nothing to add but this, this isn't really the first domino. the first domino was set long ago, when the roman legion was beginning to lose power. America being "Discovered" was just another domino being set. in other words they've been setting dominoes maybe as far as 1000 AD, they tilted the first domino.. maybe in 1930 or a few years behind that. So this is just one of the MANY dominoes tilting over the next in the giant pool of dominoes as days progress, still the dominoes are falling down.
Truth be told? The whole world is about to go back to a dark age, however in USA specially is about to hit an Eerily dark age. More so than any other place in the world.
I would suggest anyone who has independent thinking to move out of States territory ASAP. :x