"Crushing debt facing state governments stokes fear in financial analysts; Paying off loans could take years or create a crisis" by Michael Cooper and Mary Williams Walsh, New York Times / December 5, 2010
NEW YORK — While next year could be even worse, there are bigger, longer-term risks, financial analysts say. Their fear is that even when the economy recovers, the shortfalls will not disappear, because many state and local governments have so much debt — several trillion dollars’ worth, with much of it off the books and largely hidden from view — that they could be overwhelmed in the next few years.
Translation: it is YOUR TAX MONEY going to BANKS!
“It seems to me that crying wolf is probably a good thing to do at this point,’’ said Felix Rohatyn, the financier who helped save New York City from bankruptcy in the 1970s.
Some of the same people who warned of the looming subprime crisis two years ago are ringing alarm bells again. Their message: not just small towns or dying Rust Belt cities, but also large states like Illinois and California are increasingly at risk.
Related: The Massachusetts Model: Municipal Health Mess
Massachusetts Sales Tax Swindle
The Hollywood Heist of Massachusetts
Biotech Giveaway Was Borrowed Money
You are not looking so good yourself, Massachusetts.
Municipal bankruptcies or defaults have been extremely rare — no state has defaulted since the Great Depression, and only a handful of cities have declared bankruptcy or are considering doing so. But the finances of some state and local governments are so distressed that some analysts say they are reminded of the run-up to the subprime mortgage meltdown or of the debt crisis hitting nations in Europe.
Analysts fear that at some point — no one knows when — investors could balk at lending to the weakest states, setting off a crisis that could spread to the stronger ones, much as the turmoil in Europe has spread from country to country.
All part of the plan to ruin the U.S. economy and for banks to seize property.
Rohatyn warned that while municipal bankruptcies are rare, they appear increasingly possible. And the imbalances are so large in some places that the federal government will probably have to step in at some point, he said, even if that seems unlikely in the current political climate.
Yes, the STATES will need a BAILOUT so they can pay "investors."
Related: Barney Frank Benefited From State Debts
Municipal Bond Milking
Yeah, BARNEY BENEFITED from YOUR DEBT -- and took TAXPAYER PAY-OFFS, too!
And he ain't the only one: Congress Cashes Out as Americans Suffer
“I don’t like to play the scared rabbit, but I just don’t see where the end of this is,’’ he added.
And down the corporate media rabbit hole this will go.
As the downturn has ground on, some of the worst-hit cities and states have resorted to fiscal sleight of hand to stay afloat, helping them close yawning budget gaps each year, but often at great future cost.
If taxpayers were to do that this criminal government would come down on them like a ton of bricks.
I believe the word for the behavior is FRAUD!
You guys have been HANGING AROUND BANKERS and their LOBBYISTS for FAR TOO LONG!
Few workers would risk taking out second mortgages to invest in stocks, gambling that the investment gains would be enough to build bigger nest eggs and repay loans.
But that is just what Illinois, which has been failing to make the required annual payments to its pension funds for years, is doing. It borrowed $10 billion in 2003 and used the money to invest in its pension funds. The recession sent their investment returns below their target, but the state must repay the bonds, with interest.
And you see who is "helping" your community, right?
So Illinois sold another $3.5 billion in pension bonds this year and is planning to borrow another $3.7 billion for its pension funds.
What is it called when you keep doing the same thing expecting a different result?
And what did they invest in? All the MORTGAGE-BACKED SECURITIES S***!!!
It is the long-term problems of states including California, Illinois, New Jersey, and New York, that financial analysts worry about most, fearing that their problems might precipitate a crisis that could hurt other states by driving up their borrowing costs.
And ONCE AGAIN the BANKS MAKE OUT!
Next year is unlikely to bring better news.
How can that be after FIVE QUARTERS of RECOVERY?
States and cities typically face their biggest deficits after recessions officially end, as rainy-day funds are depleted and easy measures are exhausted.
Do you believe that official horse s*** excuse?
So they were SITTING ON MONEY and ALLOWING FRAUD until THINGS got TIGHTENED by the USURIOUS BANKERS that cut them the deals, huh?
--more--"
Time for the American rabbit to get angry.
It's NO LONGER a LAUGHING MATTER, either.
You think that's funny, banker?
