Guest Post: My State Presently Owes Its Pension Funds $208 Billion What About Yours?

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Wed, 01/26/2011 - 16:59 | 907214 Jason T
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As walstreepro2 once said "when you're borrowing money just to pay the interst, you are fucked."

Wed, 01/26/2011 - 17:22 | 907293 Yen Cross
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Jason Respectfully. Do you know what real money means? Do you understand soverign bids? Take a seat, and listen to the forum.

Wed, 01/26/2011 - 17:38 | 907366 spartan117
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Ok, I'm listening.  Show me the money.

Wed, 01/26/2011 - 19:21 | 907664 Zyroh
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illinois, the first federally ran state. (not counting dc and the territories)

Wed, 01/26/2011 - 17:23 | 907298 dlmaniac
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What about the situation in other 56 states?

hmmm, let me think, let me think ...

Wed, 01/26/2011 - 17:57 | 907439 Commander Cody
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USA has 57 states?  Including territories?

Wed, 01/26/2011 - 18:09 | 907476 Trape
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This might help from the chosen one, 

http://www.youtube.com/watch?v=EpGH02DtIws

 

Wed, 01/26/2011 - 18:14 | 907492 Commander Cody
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Oh dear.

Wed, 01/26/2011 - 18:18 | 907508 NotApplicable
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Well, to be fair, they probably didn't study US state capitals in Indonesia.

Wed, 01/26/2011 - 16:59 | 907215 Gubbmint Cheese
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This is bullish for the market right?

/snark

Wed, 01/26/2011 - 17:02 | 907229 Dixie Normous
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In the logic of the dollar getting slammed, yes.

Wed, 01/26/2011 - 16:59 | 907216 99er
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Half a Trillion. Hey...California always leads the nation.

Wed, 01/26/2011 - 19:02 | 907629 Rainman
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Cali leads so good almost the whole country is totally fucked up now. Our most prized export is the visual crap emenating from Hollyweird and distributed to the masses electronically. Most of the films/TV stuff are shit.

Wed, 01/26/2011 - 19:29 | 907682 Freddie
Freddie's picture

Yup.  They also export the crap a few blocks from Hollyweird in San Porn-nando Valley.  For the girls and guys who don't make it on the Hollywood casting couch.

The only things that are ever decent is when they bring in a Brit director and Brit or Aussie cast.   They are few and far between. Batman with C Bale and LA Confidential with Crowe and Pearce. 

The rest of Hollyweird's stuff is shit.

Wed, 01/26/2011 - 19:56 | 907752 andybev01
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Oh, I'm sure they did just fine on the casting couch. It was the screen tests that did them in.

Wed, 01/26/2011 - 20:35 | 907855 rosiescenario
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...uh, that would be SoCal, which we in NorCal consider a different country.

 

In NorCal we create the technology which leads to overseas job creation...we are quite good at it. And, if the job cannot be exported, our companies up here bring the foreign workers to it....

Wed, 01/26/2011 - 21:37 | 908104 Rainman
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...and you grow some outstanding reefer up there too. NorCal should split away and call themselves South Oregon. Please take Jerry, Diane, Nancy, Gavin and Barbara with you :-} Please.

Wed, 01/26/2011 - 22:32 | 908250 tellsometruth
Wed, 01/26/2011 - 17:00 | 907219 Id fight Gandhi
Id fight Gandhi's picture

I think pensioners will have to go without a check. Sucks, but that's what we got here. Do we go without fire force, police, teachers so people can kick back and retire comfortably?

It's been a ponzi scheme since the start.

Wed, 01/26/2011 - 17:16 | 907267 Weaseldog
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Do you really think there's going to be a choice?

 

After the pensioners are stiffed, the states will still need to keep making cuts.

 

So after the pensioners start becoming homeless, the police and fire departments will star laying off too.

Wed, 01/26/2011 - 18:03 | 907454 Dr. Porkchop
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The pensioners are going to keep right on getting paid, cuz they are the ones that do the voting. Now a huge lump of a demographic known as the boomers are going to be retiring, and you can make damn sure they'll be making their desire to keep the checks rolling in known.

 

No, I think it's the Gen Xers and newer who are truly fucked.

Wed, 01/26/2011 - 18:48 | 907586 tbd108
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I think you're right about the pensioners getting the "checks." However a couple of thousand a week should be able to buy at least one can of high end dog food before QE2+ is over. My dogs recommend Merrick brand. Comes in many different flavors and is made right here in America!

Wed, 01/26/2011 - 18:08 | 907473 cossack55
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Easy fix.  The police can start incinerating the homeless pensioners and then the fire dept can come and put them out. TA-DA. No applause, please.

Wed, 01/26/2011 - 19:47 | 907704 Freddie
Freddie's picture

Yup.  If you want to see how this story ends - see the implosion of the USSR.  People living in the subways begging to avoid freezing to death.  Pensioners getting pennies a month with the new currency.   Idiots elected a mu*lim and it is all going down in flames.  F*** em.

Wed, 01/26/2011 - 17:00 | 907220 Yen Cross
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Into Debt. Yes I'm a Righty.

Wed, 01/26/2011 - 17:03 | 907221 Dixie Normous
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Funny, this AEI report (if it's the one I think you refer to) is almost 1 year old.

Wed, 01/26/2011 - 17:16 | 907270 sodbuster
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So we can assume it's a whole lot worse!

Wed, 01/26/2011 - 17:20 | 907283 Dixie Normous
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Ahhhh, yep.

Wed, 01/26/2011 - 19:59 | 907758 scatterbrains
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actually no what you have to do is look at the total amount of underfunding nation wide and extrapolate what level the Bernank needs SPY to go to cover the gap. There's your upside target on the SPY

Wed, 01/26/2011 - 17:03 | 907231 StockInsanity
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  FED up with the TRUTH !

We're doing such a fine job manipulating the market so that all you poor folk out there really have no clue as to how bad it really is. We're just gonna keep on monetizing the debt until you dumb-f@#!Ks realize its all a sham. Please continue to pay no attention to what we're NOT doing. Thank you."

Wed, 01/26/2011 - 17:28 | 907319 andybev01
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I was just thinking that the Prez acts like the main character in 'The Invention Of Lying'. His mannerisms and his delivery all scream "I am the only person who knows that these numbers are distorted but if I say the words right no one will know that I am taking them for a ride!"

Except that we do see through the fog and I for one for feel slightly insulted by his demeanor.

Or if I may quote Chuck: "I don’t mind your dishonesty, half as much as I mind your opinion of me. You must think I am stupid"

Wed, 01/26/2011 - 17:04 | 907235 DoChenRollingBearing
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Default is my guess.

Or would that be better called "Jubilee"?

Wed, 01/26/2011 - 17:39 | 907360 RockyRacoon
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There is an even worse aspect to this than meets the eye.  The obligations that States have include ordinary and simple things such as stationery for offices, janitorial contractors, landscaping contractors, building maintenance firms, trash removal, and a whole array of other small businesses.   These folks will get stiffed big time!  This means a huge number of small folks who will be BK in a flash.  I'm sure it's already happening and the wave will become a tsunami.

Wed, 01/26/2011 - 17:43 | 907379 whoopsing
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Come to thinkof it,a friend of mine won't do work w/ Nassau.They don't pay! drag it out forever,been like that about two year's

Wed, 01/26/2011 - 19:39 | 907705 Dr. Sandi
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Mr. Great Hat Guy, you have stumbled upon the answer.

If they want to keep getting their checks, the pensioners will find themselves unhappily replacing all the janitors, landscapers, trash removers and other workers who are currently being paid in cash.

Sure, in either scenario the small contractors are toast, but it gives meaningful work to former pensioners who will be living productive and greatly shortened lives.

It makes up for the pension shortfall and radically reduces medicare costs too.

Nobody loses.

At least, nobody IMPORTANT.

Wed, 01/26/2011 - 22:06 | 908197 StychoKiller
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These folks will get stiffed big time!

 

"Will get??"  Vendors doing business with the Illinios state Govt HAVE BEEN getting stiffed for close to two years!

Wed, 01/26/2011 - 20:37 | 907861 rosiescenario
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...lets just call it "The New Dollar"....follow Mexico's lead on this...they were a few years ahead of us....

Wed, 01/26/2011 - 17:05 | 907239 oogs66
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NY State oversight board seized control of the finances of Nassau County on Long Island. 

Wed, 01/26/2011 - 17:14 | 907262 John McCloy
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I just saw that..next Fed takes over state finances..slow erosion of county and then state rights.

Wed, 01/26/2011 - 17:35 | 907348 whoopsing
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Oh yes,because Albany know's how to run thing's.

Wed, 01/26/2011 - 18:22 | 907521 Miss Expectations
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I found the Times article...

http://www.nytimes.com/2011/01/27/nyregion/27nassau.html?amp

My neighbor is a retired Hempstead detective.  He gets over $100,000/year, plus the disability he somehow got after he retired, plus the lifetime health care for him and his wife. He retired in his early 50's and despite his "disability" he mows his lawn with a push mower and walks the county golf course twice a week.  He also has a Mercedes which he drives around with what my husband calls the "pimp slouch". 

So, thanks for the heads up.

Wed, 01/26/2011 - 18:43 | 907595 Confused
Confused's picture

Its seems there is alot of that type of disability in Nassau. I'm not sure which is worse, police salary on LI, or property taxes. 

 

Wed, 01/26/2011 - 20:29 | 907839 whoopsing
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Long Island is going to be the poster child of "what goes wrong when the SHTF"

Wed, 01/26/2011 - 17:07 | 907241 InconvenientCou...
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chill out will you?

Dr. Benanke is working on his thesis for PhD 2.0.

The title is "Monetary Parameterization of Infinity"

 

Wed, 01/26/2011 - 18:26 | 907532 NotApplicable
NotApplicable's picture

Yep, all pensions will be off-loaded onto the Pension Benefit Guarantee Corp, and Uncle Ben will fire up the presses in order to ensure that the US can "continue to meet their obligations."

Of course, those monthly checks will have just enough purchasing power to buy your favorite flavor of dog food. But hey, that's the pensioner's problem, not The Bernank's.

Wed, 01/26/2011 - 17:08 | 907242 Yen Cross
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  There is aways a way to place a bet Stock Insanity. Put and Call options. Don't get emotional. Just trade it.  Try f/x.

Wed, 01/26/2011 - 17:08 | 907243 johngaltfla
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The proverbial other side of Municide. They can't fund it due to a real estate crash, they can't charge more sales or income taxes as net wages are still in freefall, and they can't magically print money.

Do I hear QE XXIV on the way?

This is cool. We can start numbering the QE's in Roman Numerals like the Super Bowl.

Wed, 01/26/2011 - 17:14 | 907261 I Am The Unknow...
I Am The Unknown Comic's picture

You mean "QE XLV"    Go SteAlers!!!! 

Wed, 01/26/2011 - 17:34 | 907343 Mad Max
Mad Max's picture

Ultima ratio Bernanke?

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