Because Once You Drop By Bankruptcy Court, You Don't Stop: San Bernardino On Chapter 9 Deck

Tyler Durden's picture




 

Meredith Whitney made her doomsday prediction. The nothing. Nothing. Then lots of glib muni expert pundits gloating because the Fed, the ECB, the BOJ, the BOE, the SNB, and of course, the central bank of Kenya, had managed to delay the inevitable by a year. Then some more nothing. Then suddenly Stockton, Mammoth Lakes, and now San Bernardino all file in the span of 2 weeks.

  • SAN BERNARDINO, CALIFORNIA, WEIGHING CHAPTER 9 BANKRUPTCY - BBG
  • SAN BERNARDINO COUNCIL TO DISCUSS ACTION, SPOKESWOMAN SAYS - BBG
  • SAN BERNARDINO SPOKESWOMAN GWENDOLYN WATERS SPOKE IN INTERVIEW - BBG

There is a reason marginal events are oh so very important: because as Greece showed, and now one after another broke California municipalities are dropping like flies, one the precedent is there, the easiest thing to do is to just hit Print on that Chapter X petition. After all everyone else is doing it, and remember: he who files first, files best.

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Tue, 07/10/2012 - 22:17 | 2604493 surf0766
surf0766's picture

The new high speed rail will make everything better in Kalifornia ..

Tue, 07/10/2012 - 22:27 | 2604512 TruthInSunshine
TruthInSunshine's picture

If all of the local, county and state units of government that are in deep fiscal shit, aka FUBAR, akaTARFU, aka SNAFU, aka BOHICA (meaning at least a significant plurality of such units of government) follow Scranton, PA's lead, and impose minimum wages on all employees, would such a measure resolve or merely delay the day of reckoning*.

 

*Sponsored by arithmetic; "You can run from it, but it will ultimately find its mark, bitchez."

Tue, 07/10/2012 - 22:27 | 2604526 SHEEPFUKKER
SHEEPFUKKER's picture

Too bad the local beaurocrats didn't legalize meth with all the lab technicians in the area. Might have been a major boom to the economy. 

Tue, 07/10/2012 - 22:35 | 2604553 Joe Sixpack
Joe Sixpack's picture

Anyone know if cities on county borders can petition to  change counties?

Tue, 07/10/2012 - 23:03 | 2604649 SmittyinLA
SmittyinLA's picture

No dude, its the hotel Kalifornia, you can check in but never leave.

Tue, 07/10/2012 - 23:07 | 2604657 mophead
mophead's picture

They need a high speed rail from San Bernardino to Rubidoux. Then from Rubidoux to Yucca Valley. That will boost the economy!

Tue, 07/10/2012 - 23:11 | 2604674 Jena
Jena's picture

Logic says extend it to 29 Palms and the base.  That way maybe the military will be interested in paying for part of it.  So crazy it could actually work...

Tue, 07/10/2012 - 23:19 | 2604693 veyron
veyron's picture

Once you pop the fun dont stop ...

Wed, 07/11/2012 - 00:40 | 2604931 Troll Magnet
Troll Magnet's picture

they should fire ALL public employees and replace them with illegal immigrants. they work (much) harder for (much) less.

Wed, 07/11/2012 - 00:48 | 2604949 fourchan
fourchan's picture

like the feds devaluations, the first to go bk will get reap the best rewards, later in this bk game there will be no rewards. the end is neer.

Wed, 07/11/2012 - 01:07 | 2604970 eatthebanksters
eatthebanksters's picture

What do Stockton, MammothLakes and San Bernadino all have in common?

Wed, 07/11/2012 - 01:26 | 2605005 DeadFred
DeadFred's picture

Stockton- Meth, crime, collapsed real estate market.

Mammoth Lakes- Earthquakes, snow bunnies, collapsed real estate market

San Bernadino, Meth, corruption, crime, earthquakes and collapsed real estate market.

I'm guessing it's about real estate.

Wed, 07/11/2012 - 01:47 | 2605031 The Big Ching-aso
The Big Ching-aso's picture

 

 

It's time California merged with its richer neighbor Mexico so it can avoid bankruptcy.

Wed, 07/11/2012 - 02:10 | 2605060 TruthInSunshine
TruthInSunshine's picture

 Krugman endless bowl of stupid for the win (all the Krugmanites will chime in here to claim he was taken out of context; if only it were so, Krugmanites, if only it were so...):

 

Krugman&Summers-in-Wonderland: Fight the collapse of the bubbles by creating bigger bubbles


"In 2002, Paul Krugman made his infamous statement":

To fight this recession the Fed needs more than a snapback; it needs soaring household spending to offset moribund business investment. And to do that, as Paul McCulley of Pimco put it, Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble.

"Krugman, of course, later defended his comments to claim that he did not think such a thing to be desired, but nonetheless the underlying Keynesian principle was there: in order to fight a slump in "aggregate demand," the government must think and act boldly, or, to be more accurate, recklessly."

"Indeed, Krugman's fellow Keynesian, Lawrence Summers, has taken this Keynesian principle in the same direction, recently declaring":

The central irony of financial crisis is that while it is caused by too much confidence, too much borrowing and lending and too much spending, it can only be resolved with more confidence, more borrowing and lending, and more spending. (Emphasis mine)

"While Summers is recommending yet another attempt to reflate the housing bubble (in the name of "fixing" the housing market), the larger principle is the same: inflate SOMETHING. However, as I see it, Keynesians such as Krugman and Summers have overlooked the obvious, and that is the sad fact that governments around the world -- and especially the U.S. Government -- have created the Mother of All Bubbles with government paper."

 

Wed, 07/11/2012 - 10:10 | 2605785 MachoMan
MachoMan's picture

They've overlooked rudimentary math and common sense.  At some point, the interest on marginal debt is greater than the net tax collectable on the economic activity stimulated thereby.  In other words, there are diminishing returns on debt fueled stimulus.

The problem all of these guys have is that because of their position/thesis, they never KNOW when they will be correct (when stimulus will actually help, e.g. previous recessions) and when it won't (now).  As a result, they're forced to keep their foot on the gas...  thelma and louise style.  In the end, they're simply making an argument from induction, viewing a very narrow set of data.  Yeah, they're right most all the time for run of the mill recessions and downturns...  their solutions actually turn things around (we'll disregard whether this is at the expense of future pain).  But, they can't articulate the alternative circumstances that would cause them to be wrong, e.g. our present situation.  Their view is simply too history centric with a bias towards the modern era. 

They've developed a dogma and, unfortunately, are painted into a corner...  had they undergone a paradigm shift, or at least a retreat and retrenchment following 2008, then they'd still have some goodwill to utilize.  At this point, they're patently retarded (and blazingly ignorant).

Tue, 07/10/2012 - 23:56 | 2604810 knukles
knukles's picture

Holy Shit!
What an Idea!
And bill it as someday connecting to all the DUMBS (Deep Underground Military Bases) scattered throughout the entire US with their mach4 maglev monorails connecting them so that everybody has a free government paid ultra fast transit mechanism about the whole country thereby obviating any further need for computers, tablets and phones since now everybody can talk to everybody face to face and thereby save the planet earth from the evils of the no longer "Green" iWahtchamacallit manufacturing industry and freeing the Chi-nee child slaves laboring under torturous conditions at Foxwoods Casino.

Wed, 07/11/2012 - 00:11 | 2604847 A Nanny Moose
A Nanny Moose's picture

Too much revenue generation from drunk sailors driving back to the base after a night on the town in bustling Yucca Valley.

Wed, 07/11/2012 - 02:47 | 2605096 TruthInSunshine
TruthInSunshine's picture

One has to hand it to The New York Times, one of the establishment proxy standard bearers of propaganda.

You see, if you view the world through the lens that The Times hopes you will, it's all good in the 'hood:

 

States Face Tough Choices Even as Downturn Ends
Tue, 07/10/2012 - 23:08 | 2604662 aphlaque_duck
aphlaque_duck's picture

I left.

Wed, 07/11/2012 - 00:09 | 2604851 dolce vita
dolce vita's picture

egress being planned...actually moved up in docket.

Wed, 07/11/2012 - 00:53 | 2604956 dolce vita
dolce vita's picture

im being watched............................

Wed, 07/11/2012 - 02:21 | 2605072 vato poco
vato poco's picture

Henley had an even better, if lesser-known, Kailfornia epitaph on that album. "Call a place a paradise, kiss it goodbye."

Tue, 07/10/2012 - 23:40 | 2604667 AlaricBalth
AlaricBalth's picture

Why bother? IMHO the entire state of California is headed for bankruptcy. Was just reading a very recent bond indenture for San Bernadino County (AAA Moody's and AA+ S&P). Cumulatively in CA, the Public Employees Retirement System (PERS) and the State Teachers Retirement System (STRS) have unfunded liabilities in excess of -$75 billion dollars.

What a mess!!!

Here is the indenture posted by the printing company.

http://www.royceprinting.com/jobs/FOSarchive/2012FOS/02_15_12_CentralFOS...

Tue, 07/10/2012 - 22:37 | 2604561 OldPhart
OldPhart's picture

The big dollar meth labs are out of the city and all over the county (which is rather large in area.)

Wed, 07/11/2012 - 00:16 | 2604829 knukles
knukles's picture

Berdoo is out on the edge of the Central Valley, the last of civilisation if it can be so called, right next to the edge not to far from the middle of fuck all no where comprised of one massive extended strip mall and trailer park populated by Oakies, Mexicans, Hells Angles, stretching into agricultural and animal processing facilities with an overabundance of meth labs.

 

You miss me yet said the QE now, huh?

Oh and don;t forget.
Everybody, including most everybody in California thinks it's fucked up, but as goes California, so goes the Rest of America.
You're next, bitchez

(But a Symptom of the whole rotten system disease... it'll spread more quickly than that duck penis rot crap that they tried to immunize us for a few years ago which was another NWO meme.... this is real.)

Wed, 07/11/2012 - 00:23 | 2604886 A Nanny Moose
A Nanny Moose's picture

Berdoo is out in the Central Valley

Inland Methpire. Near Fontucky. IE is not Central Valley. You must be thinking Weedpatch, Oildale, Bakersfield, Fresno, Stockton, Sac, and Molesto.

Spent time in San Berdoo. This is an area of the world wherre the police 'copter is up at 5AM asking Jerome Jordan to "come out with his hands up", and the closest regional park is an old rock quarry littered with dead washers, dryers, fridges, and couches. It almost rivals Newark, NJ.

Tue, 07/10/2012 - 22:54 | 2604623 maximin thrax
maximin thrax's picture

How about imposing a hefty state income tax, say 50%+, on all public employees on every dollar earned above the median income of the people they serve? Sort of a "wealth tax" on the relatively rich (the only kind of rich there are).

Tue, 07/10/2012 - 23:20 | 2604702 Freddie
Freddie's picture

Manson was the end for California.  It was all downhill after that.   The majority of the populace have this glazed over mentaility like Scientologists.   Stoned on Hopium.

Wed, 07/11/2012 - 08:08 | 2605346 ZeroAvatar
ZeroAvatar's picture

Definitely in a state of hypnosis.  Just like all those mooks you see standing behing Ohbummer when he gives his speeches.  You just want to snap your fingers and say, "WAKE UP!"

Tue, 07/10/2012 - 23:22 | 2604706 upWising
upWising's picture

How about imposing a hefty state income tax, say +80%, on all bank and corporate executives (assistant deputy vice president and up) on every dollar earned above the median income of the people they "serve" (or should I say enslave?)    Sort of a "wealth tax" on the ravenous vain self-absorbed vampire squid rich (the only kind of rich there are). 

The ravenos vampire squid rich will drive their Beemers to work on roads maintained by public employees, use and abuse low-paid labour who ride to work on buses driven by public employees and who will water the vampire lawns and wash the vampire clothes and cars with water systems maintained by public employees.  The vampire rich will park their planes ($3/night !!!) and take off and land from public airports run by public employees, etc.  etc.  While they sip extravagently expensive champagne, they will bitch about getting "government off their back." 

I think that's what you meant to say.  A pleasure to make those simple corrections for you.

Tue, 07/10/2012 - 23:58 | 2604813 JLee2027
JLee2027's picture

Brilliant. No one has ever, I mean ever, thought about taxing the sheet out of anything and everything that moves. Ever, I swear. Sheer genuis. It doesn't matter to you, that any bank taxed this way would close it's local business immediately right?  

Wed, 07/11/2012 - 00:05 | 2604837 knukles
knukles's picture

Please don't let them hear about that idea in the People's Socialist Paradise Republic of Californiastan.
By Jove, they'd do it!

Wed, 07/11/2012 - 00:25 | 2604892 A Nanny Moose
A Nanny Moose's picture

In CA those are the fucking state, county, and city employees. They drive the beemers, and fly the airplanes. I know several, and I shit-you-fucking-not.

Next.

Wed, 07/11/2012 - 09:07 | 2605537 marathonman
marathonman's picture

You know if CA would set up a state owned bank they could cut out the vampire squid middle man and be the vampire squid.  Pretty funny really.  Instead of taxing their (bank and corporate executives) income, how about dry up their well spring and own it?  CA could devalue the currency all on their own and use the proceeds to pay off the union pensions.

Wed, 07/11/2012 - 07:00 | 2605247 azzhatter
azzhatter's picture

and a minimum 50% haircut on pensions

Wed, 07/11/2012 - 07:03 | 2605251 skipjack
skipjack's picture

No, because that doesn't fix the retiree outlandish pension benefits problems.  Only a BK can grind that nut.

Wed, 07/11/2012 - 09:03 | 2605518 Cole Younger
Cole Younger's picture

SB is a sancturary city for illegal aliens...They spend allot of money on services...oh well, I guess that will end...

Tue, 07/10/2012 - 23:35 | 2604749 Dingleberry
Dingleberry's picture

And that's just cities going broke. Wait until that stupid liberal state  that keeps re-electing Fiend-stein and Babs Boxer and Pelosi goes broke. That's what I want to see. The entire state going belly up just might make them change their mind on a lot of silly socialist shit.  Unless you have lived there, you wouldn't believe it.

Tue, 07/10/2012 - 23:59 | 2604816 JLee2027
JLee2027's picture

Won't change squat. It will all be blamed on the evil Republicans....forever.

Wed, 07/11/2012 - 03:22 | 2605121 jeff montanye
jeff montanye's picture

not sure about boxer or pelosi but dianne feinstein is no "liberal" if that word even has meaning.  she is a war mongering, military industrial complex whoring, israel firster fascist:  http://lesserevilsarestillevil.blogspot.com/2010/12/ok-but-dianne-feinst...

Wed, 07/11/2012 - 09:11 | 2605552 marathonman
marathonman's picture

All three of those hags are fascists.  They just create a more politically stable brand of fascism by giving away freebies to the rubes at the bottom and loot the middle and upper to pay for it.  Guns or butter?  Choose both.  That's the game.  They know how to play to win. 

Wed, 07/11/2012 - 10:20 | 2605836 MachoMan
MachoMan's picture

Actually, it is liberal ideology that would allow the exansion of the state sufficient enough to war monger and whore to the military industrial complex.  You have to quit using compromised MSM terms...  ALL of your prospective political representatives are....  liberals.  Republicans, Democrats...  all liberals.  When you see a politician take a pay cut and give himself less power, you'll have found a conservative.

Wed, 07/11/2012 - 00:23 | 2604889 Arnold Ziffel
Arnold Ziffel's picture

The new high speed rail will make...it easier for bankruptcy lawyers to get around.

Tue, 07/10/2012 - 22:24 | 2604500 Cognitive Dissonance
Cognitive Dissonance's picture

Game theory suggests that we get the hell out of Dodge (NOW while the gettin's good) before Dodge files for bankruptcy and triples the taxes on our ranch and equipment.

I hear Zimbabwe is nice this time of year.

Tue, 07/10/2012 - 22:29 | 2604532 Tijuana Donkey Show
Tijuana Donkey Show's picture

Why not Kenya? I hear Obama has dual citizenship just in case.

Tue, 07/10/2012 - 22:40 | 2604565 Unprepared
Unprepared's picture

Are you inferring that the country will never get bombed... err... liberated?

Wed, 07/11/2012 - 00:04 | 2604834 Real Estate Geek
Real Estate Geek's picture

Dual citizenship, eh?  So that'd be Keyna . . . and . . .

OK, I give up. 

Wed, 07/11/2012 - 00:06 | 2604839 knukles
knukles's picture

Mecca?

Wed, 07/11/2012 - 00:40 | 2604929 Overfed
Overfed's picture

Indonesia.

Wed, 07/11/2012 - 06:13 | 2605205 Doubleguns
Doubleguns's picture

Yep and the dog tastes better there than Kenyas. I beleive they are raising a dinner meal at the white house now named BO. I am not making this up. Bo is the name of the dog. Talk about vainity.

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