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Boy, this here forum sure is high octane. Whew.
Nap time eternal.
If The German high Court does not ratify the ESM...it would get Merkel off the hook.
More time for back & forth baloney. Except economic chaos would very quickly ensue.
The IMF is greasing the wheels for major bailouts.. printing money... I wonder..
Zab, Jim Dines has a buy on a few banks...
West- very little of what Willey says comes true.
Perhaps the MS is substantial; we will know soon enough.
I don;'t see how this 'news' can be controlled as long as this rumor has been
around. Whistle blowers should be making the rounds if it was true.
Leaks would be running. I haven't seen any besides Willey..
Zab, rumor that London can't find silver... it was only a matter of time..
don't know if this is indeed the time..but its getting closer..there are bargains in
the space..
very interesting conversation posty & brightness...
my response is How MUCH do we really need to consume..??
Next question.. what services are we dependent on..??
Electric, water, sewer, roads, education, police, courts.
Who gains from all our military operations...??? That in mho
is the black hole in our economy..Those funds could return in
a constructive way for the economy, Or- the people....a la
Ron Paul.
Harrisburg to Run Out of Money in October; Inside America's Most Indebted City; Labyrinth of Fraud
Congratulations to Harrisburg, the capital of Pennsylvania, for having the highest per capita debt of any city in the country.
The town's 50,000 citizens are on the hook for $1.5 billion according to the NPR article Inside America's Most Indebted City.
The city has delayed payments to light bulb venders and paper sellers. Restaurants have hired their own security. A local strip club paid to keep the street light on. The city is projected to run out of money entirely in October.
A judge has recently ordered a 1% income tax hike on the people still left in Harrisburg. But the city council has promised to fight it.
$1.5 Billion Does Not Include Schools, Pensions, Unfunded Liabilities
The Patriot News notes Harrisburg's eye-popping debt total is just one piece of city's bleak financial puzzle
It’s almost impossible to say exactly how much money the elected and appointed officials of Harrisburg have borrowed.
Missing financial audits, complicated transactions and intertwining finances create a labyrinth of money that stretches decades into Harrisburg’s history.
At best estimates, based upon reviews of independent reports and audited financial statements, the amount of debt owed by the city and its affiliated entities — with interest — stands somewhere north of $1.5 billion.
That’s roughly $30,285 for each of the 49,528 men, women and children living in the city and almost twice the income of the average city resident.
While the amount of debt is eye-popping, it is only one piece of the jigsaw puzzle that is the city’s bleak financial background.
It does not account for past-due debt payments or unfunded pension and healthcare obligations. Nor does it include the estimated annual deficits in the city’s and school district’s budgets, which this year are so far estimated at $6.8 million for the city and at least $7 million for the school district, even with drastic cuts such as eliminating kindergarten.
A declining tax base contributes to the overall problem — between 2009 and 2012, the assessed value of property in the city dropped by more than $30 million, according to a school district report.
Meanwhile, each time property taxes increase, fewer people pay them. According to a school district report, property tax collection rates have fallen from 87 percent to 83 percent.
THE DOMINO EFFECT
City schools may find themselves in a similar situation.
In 2009, the district refinanced almost $280 million of outstanding debt to exit swap agreements and lower debt payments over the first few years by securing lower interest rates. It also borrowed an additional $10 million for building projects and equipment purchases.
In his recovery plan, former Receiver David Unkovic noted that according to the last completed financial audit of the city — and the letter of the law — the city could borrow still more money.
According to his office’s calculations, the city could legally borrow up to an additional $117 million.
Whether anyone would agree to offer the city another loan, however, is an entirely different question.
Labyrinth of Fraud
Whenever you see stories like this, you can bet your last dime that massive amounts of fraud are in play.
The NPR article profiled David Unkovic, the man appointed by the state of Pennsylvania to fix the Harrisburg debt problem.
Unkovic resigned in May, then completely vanished from public life after scrawling out a hand-written letter of resignation.
Months later, NPR tracked him down and now Unkovic believes there is something more sinister than gross mismanagement at play.
From NPR
"Illegal conduct occurred," Bill Cluck, who serves on the board that runs Harrisburg's incinerator, told me. "I think false statements were submitted under penalty of law to the state government in connection with the financing."
Stephen Reed was the mayor of Harrisburg from 1980 to 2009. People in town famously say he never met a bond he didn't like. He used the money borrowed on the incinerator to do all sorts of things.
He bought strange artifacts from all over the country, dreaming of building a Wild West museum. The city borrowed money to buy a baseball team and build a stadium; the team was later sold at a loss.
"The fundamental problem is he was borrowing more than he was really allowed to under state law," Unkovic says.
In 2007, Harrisburg filed a document called an 8110 b certificate. It was a promise, Bill Cluck says, that all the previous debt borrowed on the incinerator was still self-liquidating — that the incinerator would bring in enough money to pay the money that had been already borrowed on it.
"They knew it wasn't true when it was submitted, and it's never been corrected to this day," Cluck says.
And that, according to Cluck, was a crime.
There were 17 different revenue projections showing that the incinerator could never earn back all the money that had been borrowed.
So how was it that nobody — none of the law firms, none of the financial advisers — raised questions about the wisdom of this loan?
We asked, but they refused to respond on the record. And, Cluck notes, all those advisers made hundreds of thousands of dollars in fees from the loan.
Almost none of the $30 million the city borrowed in 2007 went to the actual incinerator upgrade. It went to pay back old debt, and to pay fees to the many firms that set up the deal in the first place. The same firms ended up on virtually every deal, Cluck says.
To make matters worse, the city ultimately was on the hook. If the incinerator couldn't make the money back, it would fall to the taxpayers of Harrisburg. And this makes Bill Cluck crazy.
"Where's the advocate for the city to say, 'Hey, you're getting screwed by the terms of these deals,'" he says. "It never happened."
Where Did the Money Go?
Stories like this irritate me because they always seem to stop short. Citing Cluck, NRR says money went to "pay fees to the many firms that set up the deal in the first place. The same firms ended up on virtually every deal".
I can certainly believe that. Indeed I would be shocked to find out otherwise. But where is the list of names? What banks and politicians profited from these shady deals? Inquiring minds and taxpayers have a right to know.
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Rece
Read more at http://globaleconomicanalysis.blogspot.com/#s1JKlRJBYFtDVItE.99
Dan, the ad more interesting than card trick..
I think you're pretty even when you're not really odd...
Lee, is Newly on the payroll..?
I have always thought Zeevs a fair & democratic scene...
I tip my hat to Dan if only cause he keeps 'things even'
Sal
West.... the rumor seems substantiated. The jackals decide who will
be the sacrifice.. WHY it isn't BofA is what I don't understand.... but time will tell.
I suspect there are whistleblowers in the wings..but, then who will protect them..???
Disagreement can be and often is respectful. I was not in any conflict with fishweed, I was with you.
You are quite bright in some of yr posts.. but, your picking on Zab the way you have been in recent days.. is very out to lunch: insane .
Put yr energy elsewhere where it can be positive, ok?
He didn't mean it as courtesy , he is simply being honest/
What is yr problem anyways?? You are continually 'picking'
to have some sort of altercation... it isn't worth the effort...
Zabs a nice person.
Bruce Thompson---where are you??
We are desperate for rain off the N. England coast..
Come in Bruce.. come in..
hmmm.. you think China supplies our guns..?
Both, don't you think...?
Thanks Lee. Dorchester & Charlestown doing well..?!! WoW, interesting.
I used to live on Appleton St off Brattle 30 odd yrs ago..them were the days.
Consider the media source.....
Lee, you're in the Boston suburbs correct..
what is real estate (residential) doing there??
tia
appreciate that post pants..very honest.
Evaluating the real estate situation is a very interesting topic.
Permits are just one of the demographics of a complex subject.
You have to sell the home you build.
I live in a terrific area.. real estate is deader than dead.
The only thing I can come up with is rates remain low and buyers have been on strike
even in the lower priced market for some years now.
Is the exuberant Manhattan $50 million market in condos a precursor to a
significant decline... I don't know.
The East coast contrasts with the West coast...but thats the norm right..??
Lee, you are entitled to yr opinion. Others may not share it.
Newspaper editor aside....
Why on earth is that personal..I thoght we talked 'brokers' here..
part of the curriculum..?
Well, Lee what broker do you use??
what does Knight have to do with TDameritrade..?
Anyone.. can anyone tell me their experiece/opinion of TDameritrade??
Thanks very much.
Connecticut Water Service Inc. (CTWS), which agreed last month to expand in New England by buying Maine-based Biddeford & Saco Water Co. (BDDD), announced it was raising its quarterly dividend 2.1 percent to $0.2425 per share.
The higher dividend will be effective for shareholders of record as of Sept. 3, the company, which has increased dividend payments for 43 years, said today in a statement
To contact the reporter on this story: Randall Hackley in Zurich at rhackley@bloomberg.net
totally agree
whats confusing about that..??
Sometimes.. it is the person doing the disliking more than their object..
I haven't ever noticed Dan being anything but normal with the 2 of you...
Thank you Dan for being who you are.
NO BS. How rare in these days.
Dan, you've taken the words right outa my mouth.
Iam certain Lee is a genius, but, oh that Canny....!!!!
Piling on..?Huh??/
I have no idea what you're worth.
Don't take it so personally.
Lee- you neglected to mention you charge 125/hour.
Interesting. I'm learning to read charts from Lee..
by osmosis....and the earths magnetic activity in northern N.E.
In a word... nauseating
The global printer-in-chief is about to address educators in Washington DC (via the video conference stream below) focusing on the need for personal financial education in the wake of the financial crisis. We suggested a name for the plan: The 'Complete Re-education And Positivism' Plan but given the audience was K-12 educators of economics, the C-R-A-P Plan just did not seem appropriate. Perhaps his proposal is the BTFD Plan?
Will he suggest investors do what the Fed does and buy Treasuries? If not why not? Is buying Treasuries a bad idea? Are they not safe? What should a personal financial advisor propose to his clients? Do tell Ben, do tell? How much gold should a small-town teacher hold in their personal portfolio? We can only imagine the level of hypocrisy about to begin...
Lee, I'm not a trader. I wish I were. My chart reading is just at kindergarten level.
How did you leanr 'charts'?? You don't seem to be a math person like Zeeve was. I'm not either.
What is yr best advice for reading charts..?? Anyone else.... welcome.
TIA
sally
then why'd you say evenually Lee??
you had something in mind.. right??
Lee, I am very curious why you don't believe now is the time to pile into hard assets . Silver, gold... why wouldn't you but them here?/
I am wondering what your time frame of 'eventually' translates to..
thanks Lee
cash is not king when the currency loses value. hard assets are to be acquired.
you nailed it Westy...eom
NOT impressed