The Ten US Cities With Less Than Ten Days Of Cash On Hand

Tyler Durden's picture

As the Detroit bankruptcy hearing heats up following news that the city's unsecured creditors, among them pensioners, are set to recover pennies on the dollar, 16 to be precise, the question of which are the next cities to follow in the footsteps of bankrupt Motown, becomes relevant once again. Courtesy of the WSJ, and the second part of its series on "U.S. Cities Grapple With Finances", here is a list of the US cities that when push comes to shove metaphorically, and when the money runs out literally, will have no choice but to knock on the door of the local regional bankruptcy court and submit that long-prepared bankruptcy petition. Specifically, here are the cities that have 10 days or less in cash on hand available. Because, unless one is the Fed, cash and lack thereof is all that matters.

The list below ranks the top 10 cities in terms of days cash on hand. Needless to say, a city with a low number in this category (such as 0.0) may have trouble paying bills, bribes, lap dances and other core municipal outlays.


Shifting away from the stock, and looking at the flow, as Detroit showed the world the very hard way, cities mired in pension costs will ultimately default and lead to massive haircuts to the retirees. The following 10 cities have the greatest percentage of pension costs as a percentage of the city's general fund.


Of course, cash on hand while perhaps the most important factor, especially if a city becomes a net cash burner, is hardly the only indicator to keep an eye on. Additional consideration must be given to amount of reserves, or the ratio of a city's total fund balance to expenditures, because if this is negative it means the city spends more than is available.


Another relevant factor: taxable real estate per capita - the lower the number here, the weaker the real-estate market, which also means the lower the city's overall wealth and its ability to raise property-tax revenue.


Debt interest costs may not be a factor under the Fed's centrally-planned ZIRP world, but when rates once again go up, there will be blood. The following 10 cities have the highest amount of debt per capita: it may not be a problem now, but it will be sooner or later.


Last but not least is the most subjective indicator, yet perhaps the most forward looking one: population growth. Because if anyone knows the reality behind a city's numbers, it is the people who live there. If people see no long-term opportunities they move somewhere else - simple as that. And the less population a city has, as anyone who has played the SimCity series knows, the less property, income and sales tax can be collected, and the more costs have to be squeezed, resulting in the dreaded evil "austerity" and, ultimately, default.

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Cursive's picture

Truth or Consequences.  We have the truth, just no consequences.

DoChenRollingBearing's picture

No richez for those fishez!  I guess this is what happens when spending too much and can-kicking keep going on and on and on...

kaiserhoff's picture

Cash flow is a bitch when you ain't got none.

Meredith Whitney be praised.

max2205's picture

You don't want to go broke in Chicago

Say What Again's picture

There's a big difference between banks and cities. 

No one gives a shit about banks, but the cities will be allowed to default.

Notice how NY has the highest debt per capita.  That explains ZIRP

kaiserhoff's picture

Good to see Calipornia leading the way.

  Go Gov Moon Beam;)

Meat Hammer's picture

California has been a public sector/EBT feeding trough my entire life here. Nobody noticed (or chose not to) when times were good, but now the host is dying and the parasites will be none too happy. 

donsluck's picture

You're just jealous. Pensions are part of their employment contract. The loss of pension is a contract violation and must be settled in court. It doesn't change the CA weather. Damn, 75 deg in NorCAL, still harvesting string beans and tomatoes.

IllusionOfChoice's picture

I'm sure they will be settled in court. Detroit is showing us how that model plays out.

NoDebt's picture

Indeed.  The fact that those pensions are in contracts and are even protected under the state constitution makes me believe they're definitely toast.  Remember, this was all sucked up in the FEDERAL court system a few months ago.  It would seem to me to serve the purpose of the Federal government (including the Obama administration, of course) to force violations of state constitutions left and right and center.  

End result:  If they are bailed out, Obama/federal government is the hero and wields yet another new power.  If they burn, the State is the bad guy.

fonestar's picture

Mathematics applies even to governments?

TeamDepends's picture

Only if Big Brother says so.  It could be 6, or 3 or infinity!  Got it?

brettd's picture

On Wednesdays, 6.

On Fridays, 3.

On the weekends, infinity.

Until next week....

Whatever our "Sky is Falling!" leaders say...

A Nanny Moose's picture

We have always been at war with Eastasia

Burticus's picture

Where's Winston Smith when you need him?  Change all those bad numbers to good or just make a seasonal adjustment.

sadmamapatriot's picture

Screw Winston Smith. I am looking for Henry Bowman.

Anusocracy's picture

They're wrong about Detroit.

It has more than ten days of hash on hand.

TheMeatTrapper's picture

Don't worry, the Feds will bail out the pensions of the lifegurads in California. Turtle trappers in Alabama will be taxed so that the government tit suckers in other States can sit at home on their ass and have their contracts "honored". Funny how they government mooches never talk about the Constitution being honored. 

Keyser's picture

To the tune of $66 trillion? 

PT's picture

Its been 24 years since Sim City, and 45 years since Hamurabi!
Have we learnt nothing??? 

Ying-Yang's picture

Medium Days of Cash on Hand for 250 Largest Cities = 81 Days

WOW... compared to preppers 81 days of cash is not so hot.

fonestar's picture

I don't believe in stacking paper cash outside your bank.

That six month's worth of cash can quickly go to six day's worth, and then nothing at all.

Deo vindice's picture

It can also go to nothing inside the bank.

At least outside you have control over gettintg rid of it in exchange for something before it hits zero.

JLee2027's picture

Probably worth tracking monthly for time left before total meltdown.

Medium Days of Cash on Hand for 250 Largest Cities = 81 Days

yepyep's picture

good point, if 81 days isnt stirring the sheep then how many do you think it will?


ima guess 30, people can relate to a one month bill cycle :)

everyone knows what 30 days to pay feels like in real time.

CalDre's picture


Federal law generally trumps state law, whether enshrined in its constitution, law, judicial decisions or wherever. 

And if for some reason a city cannot or will not declare itself rid of these pension obligations - who must pay them?  Our children, the ones who didn't enjoy the services, but were saddled with them by their parents' policians who wanted to get elected by promising public workers the moon.  But, the fact is, they won't - they'll just move to a city that does not have this debt, or make a new city, or go to a country without this legacy debt (just like people moved in the 70s to avoid court-mandated desegregation).

Why should the young people work off the excesses of their ancestors (even if they don't pay income tax, which is often 20% or less of local revenues, they still must pay property tax; sales tax; fuel tax; payroll taxes, motor vehicle taxes, etc., etc.)?  Graduating with huge loans, already starting out negative - how high taxes must they pay so that people of mediocre capabilities (not all, but most) to retire after 20 years work and earn 80% of salary, or more, for 40 more?

The bottom line is:  you can't suck blood from a turnip or from someone who can run away.

And no, you can't take it from the rich - because if you haven't noticed they have been off-shoring their wealth (capital, even equipment - all US does now is cook each other hamburgers, and the elite certainly aren't going to look back twice.

Note how big corporations - and their owners - already don't even get taxed now on what they earn.  If Apple makes money in China, it needs not pay tax on that income.  But if I make money in China by working, consulting, playing the stock market, whatever - I do have to pay.


Occams_Chainsaw's picture

I'll gladly pay you back next Tuesday for a burger today....

You hit it on the head man....

Fish Gone Bad's picture

lets just see how America does with testing the power grid on 11/11/13.  If we have a SELDON crisis, then all bets are off.

For those who don't know, Harry Seldon was a character in Asimov's Foundation series.

August's picture

Hari, not Harry. 

This is zh; proofreading isn't mandatory, but Jeez....

Freddie's picture

Anyone know what the law is in CA?  I know Detriot is claiming state law says the state must pay to make the pension solvent.

What is the real haircut number is Detroit? 85% or 20%? 

brettd's picture

If forced to, how would you make it solvent?

Sell the art in the Museum?  Vacant real estate?

The toll/transit system?

How would that actually work?


angel_of_joy's picture

The go tax your marvelous weather !

You should make plenty of money that way, to pay for any pension plan no matter how stupid.

STP's picture

Yep, I am so jealous.  I wish I was an Alameda County Supervisor, so I can retire with a $423K pension for life AND get an 8K car allowance a year!



CalDre's picture


Yeah, and when the city declares bankruptcy, every dollar in her "pension" - actuarailly, what is it, a rich white woman should expect to live to, what, 87? that's 22 years, for a total of almost $10 million.  I wonder what wonders she did for Alameda, that is worth $10 million?

Reaper's picture

FYI. The US Constitution in Article I Section 8 states, "The Congress shall have the power ...To establish ...uniform Laws on the subject of Bankruptcy throughout the United States." In bankruptcy, all contracts can be voided or altered.

Congress has already passed a law for municipal bankruptcy. Congress may and should also pass a law for State bankruptcies. Further, such a Federal Bankruptcy law for States would allow State Constitutional clauses forbidding the reduction of pensions to be voided, as exist in NY and some other States

Stoploss's picture

Potassium Iodide much don?

quasimodo's picture

Mmmm, veggies from Cali, replete with some radiation from me sucky you likey long time. 

Color me jealous don.

Mitzibitzi's picture

Now please don't take this the wrong way, but... I live in north Wales - where it is definitely NOT 75 degrees - and I'm still harvesting string beans (and French beans and runner beans and peas) and tomatoes. And watercress, pak choi, 7 different lettuces, 11 kinds of chilli, spinach, yolo-peppers and cucumbers. And grapes (white and red) and blackcurrants. And horseradish, Szechuan pepper, sage, oregano, rosemary, thyme, figs, sweetcorn...

I don't have a swimming pool, or a 14mpg SUV (my diesel station wagon averages 62mpg, in fact - not that quick but not expensive to run, either! The speed limit in this country is 70mph. My car will do 135, if you wait long enough; about 56 seconds, from a standing start - I'm British, not dead - one has to find these things out!), you see... I have a well-insulated house. And a greenhouse/glasshouse. And chickens, which lay eggs. And 6 months food supplies. And rainwater capture (it rains here!) And two fucking big dogs to protect the house from the local scrotes who've watched too much American TV and think they're in a gang, can't be arsed to work for a living, take too many drugs and have the life expectancy of a snowflake in a blast furnace if the current 'money for nothing and your kicks for free' system ever ends. So middle of next year, I would guess.

WOAR's picture

Play a game called Don't Starve.

Everyone dies the first winter...unless they've survived it before.

Which is a Catch 22 for the Free Shit Army.

Rock On Roger's picture


Most excellent

Stack On

SoCalBusted's picture

Do you mean a contract like the one bond holders of certain car manufacturers had?

booboo's picture

Blood sucking carpet baggers are moving into the south with their Fran Dresher accents whining, "how's come you don't have light rail, you need a vibrant down town night life" Yadda, Yadda, Yadda. The bankers send them in first to soften up the crowd and thing you know the city council is taking trips to New York and talking a bond issuance for gay bars and soccer stadiums.

Lednbrass's picture

There is a wave of seriously annoying scum heading to the South, they have crapped where they live for years and now seek new areas to ruin.  New Englanders are the human equivalent of rats carrying the plague, wherever they go death, destruction, and blight.

They can't get it through their heads that nobody gives a shit what they do in New York or Boston or how they do it and seem genuinely surprised when met with hostility. Get it straight folks- people down here HATE you.

New Yorkers etc. should stay the hell where they are instead of seeking new areas, when things implode they're going to be hunted for fun.

Chupacabra-322's picture

But tell us, how do you really feel?

Mitzibitzi's picture

Northern England, and most especially Wales and Scotland, have the exact same opinion about anyone from the London area.

Though it's surprising how many London accents you hear in the supermarket, all families who've moved once they realise that anyone with some brains and business talent can make about 80% of the money here, while paying 45-50% of the house prices.

GOSPLAN HERO's picture

Edmund Ruffin's Famous Last Words

On June 18, 1865 Edmund Ruffin, one of the leading antebellum proponents of Southern secession, chose to commit suicide rather than submit to the subjugation of Yankee rule. Defiant to the bitter end, this fiery Southern patriot penned these famous last words in his diary just minutes before taking leave of the Yankee tyranny that had descended upon Dixie...
"I here declare my unmitigated hatred to Yankee rule -- to all political, social and business connection with the Yankees and to the Yankee race. Would that I could impress these sentiments, in their full force, on every living Southerner and bequeath them to every one yet to be born! May such sentiments be held universally in the outraged and down-trodden South, though in silence and stillness, until the now far-distant day shall arrive for just retribution for Yankee usurpation, oppression and atrocious outrages, and for deliverance and vengeance for the now ruined, subjugated and enslaved Southern States!

...And now with my latest writing and utterance, and with what will be near my latest breath, I here repeat and would willingly proclaim my unmitigated hatred to Yankee rule--to all political, social and business connections with Yankees, and the perfidious, malignant and vile Yankee race."

--Edmund Ruffin

sunnyside's picture

Fuck that.  At least take a few with you when you go down.

El Vaquero's picture

I'm in the southwest, and we have ha d a bunch of Californians and New Englanders moving here.  The ones that come here and keep to themselves or take to some of our ways are left alone or are even accepted, but only in the larger cities.  The others constantly bitch about how rude we are.  Yeah?  Well, fuck'em.  We like to eat beans and hot food and have matanzas.  We like to hang out with the same people we were friends with in middle school because we made some strong bonds with those people back then.  Blue collar will hang out with white collar, and it works for us.  We like to hunt and fish.  If you move out here and you have a problem with that, you had better either leave fast, or hang out on some little enclave of pretentiousness.  Don't plan on coming out here to build a McMansion that you cannot afford, driving up property taxes for the old timers and ruining communities that have been around for longer than almost every single city on the east coast.  We will be rude to you because we do not like you.