STATES FISCAL CRISIS GROWS AS REVENUE DROPS 30%

COMBO Title and Securitization Search, Report, Documents, Analysis & Commentary COMBO Title and Securitization Search, Report, Documents, Analysis & Commentary

THAT LIGHT AT THE END OF THE TUNNEL IS A TRAIN COMING AT US. State revenue was $1.6 trillion. Latest report is $1.1 Trillion. That is a 12 month drop!! As we all know governments don’t typically save money, so there is nowhere to go but down from here. Of course if they went after all those illegal transfers and income taxes, recording fees, penalties etc., they would be pretty much OK. But the banks own the place to paraphrase Senator Durken, and that just isn’t going to happen.

So here we are. The stimulus money runs out somewhere around June 1, 2011. Many of the states are worse than broke even now with the stimulus money coming in. So we are going to see services cut that we are pretending will always be there because we can’t imagine a world without them. It’s going to happen anyway. We are going to see bond defaults even where they were originally rated AAA by our wonderful friends at Moody’s et al.

Interest rates are going to rise across the entire market which will further depress the housing prices.

All this is happening because we don’t have the guts to cut the mega banks into little pieces even though they slashed the hell out of us, our country, and our standard of living. And we can’t depend upon our government to do anything because they too are controlled by the banks. AND the banks continue to mercilessly exercise their power with total disregard for the consequences of our nation and the citizens who gave them the charter to operate.

BUT American history has had some interesting twists and we have been here before. It turns out we have a history of allowing things to get really bad before we do anything, but when we do rise up and do something it can be pretty spectacular. Unfortunately it also looks like things have to get pretty ugly out there before American assert their rights as the only real boss of this nation, for the people, by the people. People in power never learn the essential lesson of history, perhaps because they don’t care — they will be rich and perhaps powerful even after things are turned right-side up. But if they are assuming that we will all go quietly into the economic jails they have constructed for us, they are very much mistaken. Of that I’m sure.

10 Responses

  1. I live in SC and we already have a large group of unemployed poor here. Recently, a statistic came out that 25% of the people in SC do not have enough food to eat. People will have no choice but to turn to crime to survive.

    State governments are also going to PreTrial Release with no bail and no bail bondsman to keep an eye on the criminals. Crime will absolutely start to rise, and what we have left of the rule of law is going to go down the tubes. Banana Republic here we come. http://www.challengingforeclosure.com Sirak@challengingforeclosure.com

  2. Once again, we live in a BANANA REPUBLIC, with a 21st century army and a 22nd century criminals in the financial and political sectors, poverty rising, productivity dropping, over 25,000,000 American without meaningful means of support, over 45,000,000 American getting food stamps, and the republicans are bashing the Venezuelan Gorila “Chavez” for being a crook and a crminial.

    I am so disapointed

  3. It’s god awful ….the greed of man… My son could share befor he was 6.

  4. The FED will start buying muni’s ,, count on it ,,, if you haven’t already “gone Galt” you need to ,, otherwise you’re just going to be milked to death…

  5. Jan Van Eck great analysis. It is already happening. The crime rate at least here in Los Angeles has skyrocketed. The media is not telling us the whole picture.

    The gated communities in the affluent neighborhood in particular. The media or Police hardly ever report such crimes (hurts property values).

    Wait until Gov. Brown starts more furloughs and fires State and forces Municipal Employees.

    That is when the real party begins.

    All they had to do is abide by the LAWS. This would never happen.

    NEVER AGAIN

  6. Big Money and Banks have usurped the Constitution.

  7. The US is a republic, Of The People For People By The People.Democracy is where votes are bought and sold every day. Abolish the Fed Reserve or Nationalize the banks immediately.

  8. Unfortunately, Neil’s ideas that “the people” will rise up in a populist movement to reassert control over the government against economic abusers is unlikely. Our current Party system is not formatted for that. A more logical outcome is the model of Colombia, with the abused and dispossessed going to alternative economic activities, including crime. Specifically, crimes against the “rich,” including burglary, kidnapping and murder, are going to take off, together with economic crimes such as marijuana growing and meth manufacture. And with no money to pay for either prisons or prosecutors or police, these will go largely ignored.

    The “rich,” particularly kidnap targets such as Wall Streeters, will likely respond by living in “gated communities” with private armies. That fails when the private armed guards realize there is more money in kidnapping their employers than being a guard for a salary. All this is inevitable when great disparities of wealth consume a society – and where the generator of that wealth flows from economic crimes against ordinary folks.

  9. Neil…

    California is getting ready roll its Tax Payers with a massive tax increase to the tune of $.55c on the buck. Do you plan to leave the state?

  10. great post.

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