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California Borrows $40 Million Per Day To Pay For Unemployment Insurance

Tyler Durden's picture

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Mon, 11/08/2010 - 15:38 | 709110 bpj
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It's OK, we have to hit rock fucking bottom before anything will ever change here.

Mon, 11/08/2010 - 15:43 | 709134 Clapham Junction
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Agree, may happen before dickface2 comes back from India.

Mon, 11/08/2010 - 16:32 | 709351 dlmaniac
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... borrow to cover the unemployment benefits and WELFARE CHECKS FOR ILLEGAL IMMIGRANTS.

Mon, 11/08/2010 - 15:51 | 709178 A Nanny Moose
A Nanny Moose's picture

It's all good. We just voted to make it easier to pass the budget, and to raise our  own taxes to "save" our parks. All is well again.

Mon, 11/08/2010 - 16:08 | 709255 whatsinaname
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Wonder what would happen to the dollar if the govt ended its UE generous programs ? Would it decline even further quicker or rebound in the hope that govt may get a better handle on its finances ? opinions ?

Mon, 11/08/2010 - 16:42 | 709387 Max Hunter
Max Hunter's picture

It would decline but that's nothing because social unrest would be the biggest concern.

Tue, 11/09/2010 - 01:00 | 710598 goldfish1
goldfish1's picture

Correct my math...isn't this $14.6 B per year?

Mon, 11/08/2010 - 15:38 | 709115 SheepDog-One
SheepDog-One's picture

Delusion, bitchezez.

Mon, 11/08/2010 - 15:43 | 709120 99er
Mon, 11/08/2010 - 15:40 | 709122 Sudden Debt
Sudden Debt's picture

And that's why they call it THE CITY OF ANGELS

Give Give Give... Arnold will go to heaven for that. I'm sure he will. BUT!!! HE'LL BE BACK!!

Mon, 11/08/2010 - 15:40 | 709125 OnTheWaterfront
OnTheWaterfront's picture

IOU's Bitchez!!!

Mon, 11/08/2010 - 16:01 | 709213 Problem Is
Problem Is's picture

Maybe IOUs...
But Calif still has more big chested tanned blondes (Real, fake or otherwise) per capita than any other state...

You Neeeed Us...
Without big chested tanned blondes....

Amerika can't function bitchez...

Mon, 11/08/2010 - 16:10 | 709268 VegasBD
VegasBD's picture

Its all real skin.

Mon, 11/08/2010 - 16:56 | 709461 goldsaver
goldsaver's picture

You Neeeed Us...
Without big chested tanned blondes....

Amerika can't function bitchez..

Not really, we will just import them cheaper from Russia. Outsourcing Bitchez!!


Mon, 11/08/2010 - 17:36 | 709617 Problem Is
Problem Is's picture


Yeah those Ukrainian blondes are skinny little bitchez...

Mon, 11/08/2010 - 15:42 | 709132 ZackAttack
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I guarantee, nothing happens at all until the day the checks can't go out.

Mon, 11/08/2010 - 15:44 | 709135 TheMonetaryRed
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Yes, Tyler, there will be trillions in monetization.

What's your suggestion?

Trillions in defaults?

They can monetize all they want as far as I'm concerned. What do I care?

Mon, 11/08/2010 - 15:45 | 709144 H. Perowne
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My suggestion is to read up on Einstein's definition of insanity. And Santayana's advice on history. 

Mon, 11/08/2010 - 15:47 | 709156 TheMonetaryRed
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History predicts massive monetization. What's the problem?

People need to grow up. There's gonna be a haircut one way or another and monetization is the better haircut.

Mon, 11/08/2010 - 15:53 | 709190 A Nanny Moose
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Haircuts! I think not.


You go a license to wield those scissors?

Mon, 11/08/2010 - 16:01 | 709221 TheMonetaryRed
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In a massive default, to whom do people turn?

That's right, the lender of last resort. Does the lender of last resort become more or less powerful when the entire world turns to them for a bailout?

Think for Pete's sake.

Mon, 11/08/2010 - 16:45 | 709405 MachoMan
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You presume that the FED lives in perpetuity and may be the lender of last resort for eternity.  The lender of last resort to which you refer is going to be an altogether different party, most likely with interests dire and contrary to our own (yes, we have similar interests to the fed, as we're all accomplices to its printing regime).  The FED is merely a temporary top to the lending totem pole.  The next guy is going to carry a whip and give you a "white" name...  toby.

Sure, we can print with reckless abandon now, but we'll just hasten the FED's demise and the rise of the whip.  Your choice.

Mon, 11/08/2010 - 16:46 | 709416 packman
packman's picture

TMR's right.

I'm not really sure if we're ready to be ruled by China though.    I just don't think so.


Tue, 11/09/2010 - 00:55 | 710595 RockyRacoon
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Those of us who want a reset of the economy/country/politics/etc must accept a default.  I've pretty much stopped the expectation that changes will be made to "save" this situation.  So, rooting for the demise of the current regime is a natural state.

Mon, 11/08/2010 - 16:03 | 709230 Eternal Student
Eternal Student's picture

Um, yeah. That just worked out spectacularly well for Japan these past twenty years.

The difference with defaults is that you get it over with quickly. Had Obama not been a Wall Street puppet, we'd be coming out of this Depression by now, instead of looking forward to more years of it.

Mon, 11/08/2010 - 16:47 | 709418 MachoMan
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If by coming out of the depression you mean in total realization that the world has hit a significant growth wall, government spending is unsustainable and its traditional powers should be supplanted by private actors, and a couple billion people need to be liquidated, then yes, maybe...

Mon, 11/08/2010 - 17:07 | 709510 traderjoe
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I agreed with everything you said (even though said in sarcasm) until you got the people liquidation part. I don't believe that is necessary if the transition was planned and well-crafted. However, kicking the can further down the road only ensures, IMHO, that any inevitable transition will be chaotic and just might feature that 2 billion person liquidation, i.e. wars, famines, etc. 

Mon, 11/08/2010 - 17:16 | 709546 SheepDog-One
SheepDog-One's picture

'Haircut'...lol the stylist couldnt reach your hair with your head so firmly parked up your keester!

Mon, 11/08/2010 - 15:47 | 709152 Jean Valjean
Jean Valjean's picture

I would guess that tyler and ron paul would both answer, YES, trillions in defaults.

Mon, 11/08/2010 - 15:49 | 709162 Ragnarok
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Punish the guilty and reward the savers. Justice.

Mon, 11/08/2010 - 15:51 | 709176 TheMonetaryRed
TheMonetaryRed's picture

No, default = destroying the savers.

What do you think default is?

Mon, 11/08/2010 - 15:53 | 709187 Ragnarok
Ragnarok's picture

No, default = destroying the bondholders.


Na na... na na... boo boo...

Mon, 11/08/2010 - 15:57 | 709197 TheMonetaryRed
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I see, so a bondholder isn't a saver? Is that it?

Who's a "saver" then, some jerk with cans of beans, boxes of .223 and shiny rocks buried in his back yard?

I've got compost buried in my back yard, am I a "saver" too?

Besides, if you monetize you destroy bondholders anyway. Make some sense.

Mon, 11/08/2010 - 16:02 | 709223 Ragnarok
Ragnarok's picture

No a bondholder is an investor who agreed to take a risk, a saver simply wishes to accumulate excess production in a risk-free vehicle for consumption at a later date.

Mon, 11/08/2010 - 16:08 | 709259 TheMonetaryRed
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There's no such thing as a "risk-free vehicle" and no reason anyone should expect one to exist.

Mon, 11/08/2010 - 16:17 | 709292 Ragnarok
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Relatively.  And this leads exactly to the point that the money changers leave very few and convenient ways to opt out of the system.  One must be forced to always have his wealth at risk.

Mon, 11/08/2010 - 16:22 | 709311 TheMonetaryRed
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And inflation is a risk to all wealth - so what's the problem?

Mon, 11/08/2010 - 16:50 | 709433 MachoMan
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the problem you fucking twonk is that the mechanism for inflation is unjustifiably and unreasonably controlled, outside the consent of the populace and completely to our detriment.

Mon, 11/08/2010 - 17:12 | 709525 traderjoe
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Rag & Macho - yes. 

I believe a system of a stable currency WOULD allow for workers to store the value of their labor over time. Without having to deal with the parasitic money changers. Without living in the fear of inflation and destruction of their savings (by a privately-held banking cabal acting in the own self-interests). 

Mon, 11/08/2010 - 16:35 | 709360 Ricky Bobby
Ricky Bobby's picture

Ragnarok, You pretty much kicked his ass. I think the difference is you argue from an ethical point of view.

Mon, 11/08/2010 - 16:46 | 709407 Max Hunter
Max Hunter's picture

One must be forced to always have his wealth at risk.

Always been this way, always will..

Mon, 11/08/2010 - 15:47 | 709154 Tyler Durden
Tyler Durden's picture

Why does nobody understand the very simple fact that a balance sheet restructuring does not imply liquidation, and that a business can continue operating even as its liabilities are adjusted (and those who took on risk and failed, are actually not rewarded).

Mon, 11/08/2010 - 15:54 | 709169 TheMonetaryRed
TheMonetaryRed's picture

"Balance sheet restructuring"? Please.

Answer the question: trillions in bad debt = trillions in monetization or trillions in default. 

Which do you choose?

It's clear to me that sovereign default is idiocy. Monetization is the rational method to get even the Rothbardian debt repudiation.

Mon, 11/08/2010 - 15:56 | 709198 TheGreatPonzi
TheGreatPonzi's picture

If that was so simple, we wouldn't need to work in order to feed ourselves. Money printing does not produce wealth (goods, services, value added, you know). So the result is exactly the same in the end, except that monetization rewards motherfuckers and punishes rational hard-working people.

Mon, 11/08/2010 - 15:59 | 709210 TheMonetaryRed
TheMonetaryRed's picture

Massive monetization rewards nobody. What it saves in default pain it makes up for in inflation pain.

There's no free lunch here, just more and less rational ways of dealing with the same problem. The idea that we should completely undermine the entire structure of every financial institution in the world because of some farcical notion of "justice" is ridiculous.

Mon, 11/08/2010 - 16:06 | 709246 TheGreatPonzi
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The entire structure of every financial institution will go undermined anyway. Hyperinflation is far worse than hyperdeflation. In Weimar germany, 10000 businesses were failing per day.

Mon, 11/08/2010 - 16:30 | 709343 TheMonetaryRed
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That's one of the reasons we don't use a gold standard anymore.

When debt was settled in gold, but commerce was in fiat currency fiat currencies could become absolutely (rather than relatively) vulnerable.

Mon, 11/08/2010 - 16:36 | 709362 TheGreatPonzi
TheGreatPonzi's picture

You're a dumb douchebag. Debts have never been settled in gold. They were settled in paper linked to gold, just like commerce was.

So what do you suggest, exactly? Who are you? What do you want?

A banker from GS disguised into an inoffensive Internet troll?

According to you, default and hyperinflation are equal, fiat money is better than the gold standard, savers and investors are the same, and the people who took risks should be bailed-out by taxpayers money.

Mon, 11/08/2010 - 16:46 | 709411 TheMonetaryRed
TheMonetaryRed's picture

Well, German war reparations were settled in gold marks, so either they did represent gold - in which case the gold standard was destabilizing - or they didn't - in which case gold can be re-hypothecated like any other asset, rendering the entire Austrian thesis moot.

Mon, 11/08/2010 - 17:16 | 709548 traderjoe
traderjoe's picture

Cause and effect? Are you blaming the destruction of the currency on the gold standard or the war reparations or both? The war reparations had nothing to do with the gold standard. It created an un-payable debt...

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