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Santelli Explains Why A Broke California "Likes" A Hot Facebook IPO
The unsurprising and yet depressingly real budget data from California today should shock no-one and CNBC's Rick Santelli provides the most succinct and even more saddening reality check on the situation this morning as he points out the $15.7 billion shortfall and how cuts and compromise will fill that gap. His sane response to the implicit rise in taxation that this compromise realistically requires will mean - happy feet as Californians leave the state. His rant is one of the best but a little later in the day, the problem appears to be on its way to being fixed by none other than the hoody-in-chief himself. According to Bloomberg, Facebook Inc.’s initial public offering likely will account for 20 percent of California’s personal income growth this calendar year, the state fiscal analyst said. The state expects personal income to grow 4.9 percent in 2012. If the Facebook IPO were excluded, that would total 4.0 percent, the agency said. Money paid to company executives, investors and insiders would equal 1 percent of all personal income in 2012, the agency said. So two things come to mind: 1) we sure hope there are more mega-IPOs due next year to fund CALI's shortfall or we may have to pull the 'transitory' or unsustainable card out of the drawer; and 2) how will all those Facebook employees (and the corporation itself) feel when they start facing higher taxes (as Saverin just pre-emptively did?). Will they follow Santelli's happy feet out of the state? In the meantime, it would appear that the Facebook IPO is just the snake-oil medication that everyone needs - how could the IPO go wrong?
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Well, duh. If you're not saying what Santelli said, it may even be true.
Do you have any idea what you were "disagreeing" with me about? Can you restate it in your own words?
Yes and no.
(I don't have time to completely re-educate you, even if that is possible ... )
Bullshit is as bullshit does, bro.
California may have very attractive\plastic people walking around but I would gather the majority of them are very superficial and quite self-centered. From what I've heard, Texas women are extremely beautiful and down to earth. That, and the ocean water being so cold you can't even swim in it without a wet-suit makes the Jersey Shore look like a viable competitor.
BTW-most high tech work does not even require that you live in the same state any more. VPN, Remote Desktop, Citrix, gotomeeting, video conferencing have reduced the need to work 'on-site' in the tech sector.
For the record, the only time I spent in Cali was to switch planes on my way back\forth to Hawaii (twice). Aside from the costs, I doubt that you would find a better mix of beautiful landscape, weather and people.
I would still love to visit Cali (San D., San Fran, wine country, PCH, etc) just haven't had the chance yet.
-nuff said
The beautiful women of California want successful men with money. Better you stick to the Jersey Shore. You'd have blue balls in California.
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So California is going to win the IPO lottery, so to speak. Unfortunately, they will suffer the same fate as most lottery winners - bankruptcy. California's problems are spending problems, not revenue problems. It does not matter how much money they take in, they will find away to piss it all away. Remember Peter Lynch's "Bladder Theory" - the more money that ends up in the State Treasury, the greater the pressure to piss it all away!
I voted with my "happy feet" and ran -- not walked -- from the People Republic of California 8.5 years ago.
Illinois is in bad shape as well. At least California has the weather. Pick neither of them.
The only way these states will learn is the hard way. Businesses should move out of California and Illinois.
Illinois is already going the Califoria route, much more taxes.