Patterico's Pontifications

5/28/2013

New York Times Article on Alleged California Surpluses Ignores Crushing California Debt

Filed under: General — Patterico @ 7:47 am

Their story is titled California Faces a New Quandary, Too Much Money.

Too much money!

After years of grueling battles over state budget deficits and spending cuts, California has a new challenge on its hands: too much money. An unexpected surplus is fueling an argument over how the state should respond to its turn of good fortune.

The amount is a matter of debate, but by any measure significant: between $1.2 billion, projected by Gov. Jerry Brown, and $4.4 billion, the estimate of the Legislature’s independent financial analyst. The surplus comes barely three years after the state was facing a deficit of close to $60 billion.

It’s “by any measure” significant? How about by the measure of what we owe?

Apparently the debate is over how best to squander the alleged tiny surpluses: spend spend spend, or tax cuts. Not mentioned anywhere in the story: California’s crushing debt burden. For that, you have to go to this link from CBS.

The combined debt of California’s state and local governments is at least $848 billion and could escalate past $1.1 trillion, according to a new report.

The California Public Policy Center – focused on the analysis of California’s financial information on the state and local government levels — based its findings on official reports from the offices of the state controller and treasurer.

Gov. Jerry Brown’s $27.8 billion “wall of debt” was only part of the state’s official debt that the report put at $132.6 billion.

All of a sudden a $1.2 billion alleged surplus does not look “significant” by the “measure” of placing it next to a trillion dollars of debt and unfunded liabilities.

Too bad the New York Times doesn’t offer this perspective, at all, anywhere.

61 Responses to “New York Times Article on Alleged California Surpluses Ignores Crushing California Debt”

  1. There’s also the little matter of the total collapse of sales tax revenue, re Comptroller Chiang’s report

    narciso (3fec35)

  2. Can someone explain this to me;

    http://www.sco.ca.gov/Files-EO/05-13summary.pdf

    narciso (3fec35)

  3. the average new monthly mortgage payment is up $234 (+26%) over last year?

    how is that different from hyperinflation exactly

    happyfeet (8ce051)

  4. But you can’t see, taste or feel debt! It’s invisible! It doesn’t count!

    Dear Leader Barry (be0117)

  5. Maybe revenues are up because we are growing another real estate bubble? Whoopee!

    And people took their capital gains in 2012 to avoid the fed increase in 2013? (Makes the legislature look smart, and/or criminal, to make our tax increase retroactive, huh?)

    http://www.bloomberg.com/news/2013-05-16/brooklyn-to-california-bubble-threat-grows-in-housing.html

    Patricia (be0117)

  6. The revenues are up this year because a lot of rich people, who support California with capital gains taxes, cashed in investments before the rates went up last January. This is a one time thing and, like most of the state’s recent history, will be followed by spending as though this were the new baseline. Next year they will be wondering what happened as the bottom falls out.

    Nothing new here. California is dependent on capital gains. Wait until interest rates go up and the stock market does a 1929.

    Mike K (dc6ffe)

  7. The amount is a matter of debate, but by any measure significant: between $1.2 billion, projected by Gov. Jerry Brown, and $4.4 billion, the estimate of the Legislature’s independent financial analyst. The surplus comes barely three years after the state was facing a deficit of close to $60 billion.

    Projected and estimate. It’s all funny money until its real. And we all know how good the government is at estimation. Look at the unemployment rate and the drop in the number of people in the workforce. The stimulus hasn’t meant projections too. There’s an old saying. Don’t count your chickens before they hatch. I sincerely doubt there will be a surplus.

    Tanny O'Haley (2ece1d)

  8. The overall amount of debt or the unfunded pension liabilities and the annual surplus are two different things.

    Anyway the New York Times is merely reporting what some Democrats are saying. It also reports:


    Mr. Brown, a Democrat who has always had a fiscally conservative streak, is leading the don’t-pop-any-Champagne-corks brigade, saying that he would oppose significant increases in new spending and that the money should go into a rainy-day fund……“I support the governor’s call to pay down more debt aggressively, I support the notion of a rainy-day fund,” said Darrell Steinberg, the president pro tem of the Senate. “But I also believe that we have an obligation to make some limited but important investments in restoring some of what has been lost over the last four or five years.”

    Vanessa Aramayo, the director of California Partnership, a group of organizations pushing for social service spending, said Mr. Brown was deliberately understating the state’s financial health.

    The New York times also reported that the same situation exists at the national level. There was expected to be a need to raise the debt ceiling in late May or, as time went on, during the summer, but now it may not come until the fall.

    The cause in both cases is being attributed to the same thing. Static analysis. They don’t say it but that’s the problem. When it looked like the Bush tax cuts were going to expire, and the capital gains tax rate was going to go up, many people cashed in their gains at the end of 2012, thus reporting more income. But there may be more to it. There may be some economic growth.

    New York City, on tyyeh other hand has a big problem, which nobody is talking about.

    In 2008 Mayor Bloomberg gave most unions 4% raises for 2009 and 2010 approximately. The unions whose contracts came up later, after Lehman, the biggest of which is the teachers union, missed out. They got no raises, and neither have there been any raises for 2011 and 2012.

    The workers are working without contracts but they expect retroactive pay increases. 4% for thoosew who missed out and cost of living for all from the year 2011 would amoiunt to ahit of over $7 billion and about $10 billion if we waited another year.

    The unions are going tosk the next mayor, come Jan 1, for raises and retroactive pay.

    Sammy Finkelman (d22d64)

  9. I think Jerry Brown is desperate to make it to his November 2014 reelection without having to raise taxes again, but once the ballots are counted and he is sworn in for the second term, look for the Democrats to go hog wild on the tax front.

    JVW (23867e)

  10. i’d rather my daughter have lesbian sex with an 18 year old than get drunk off her ass and get knocked up by a butt-ignorant alaskan hockey jock

    if i got to pick

    happyfeet (c60db2)

  11. Unbelievable
    one would almost surmise that
    Times has agenda!

    Colonel Haiku (fa70e5)

  12. Yeah, they are desperate not to be seen as colossal failures as the state circles the drain.

    The ad I’d run, over and over, would be this:
    “California: Keep voting the way you are voting, and you’ll keep getting what you are getting.”

    Of course, that would depend on the Republicans to stop banging the abortion and gay drums, at least for a little bit.

    Kevin M (bf8ad7)

  13. Ah pikachu, brought the torch so you can burn the biracial couple at the stake, frosting?

    narciso (3fec35)

  14. The revenues are up this year because a lot of rich people, who support California with capital gains taxes, cashed in investments before the rates went up last January. This is a one time thing and, like most of the state’s recent history, will be followed by spending as though this were the new baseline. Next year they will be wondering what happened as the bottom falls out.

    Ditto.

    Kevin M (bf8ad7)

  15. 3. Cmment by happyfeet (8ce051) — 5/28/2013 @ 8:14 am

    the average new monthly mortgage payment is up $234 (+26%) over last year?

    how is that different from hyperinflation exactly

    In hyperinflation, the average income goes up about 25% as well.

    Sammy Finkelman (d22d64)

  16. Comment by Colonel Haiku (fa70e5) — 5/28/2013 @ 9:35 am

    one would almost surmise that
    Times has agenda!

    They are also reporting (Saturday and Monday) that
    Obamacare has problems (but Republicans and.or gridlock in Congress are causing them, or refusing to fix them)

    http://www.nytimes.com/2013/05/25/us/states-policies-on-health-care-exclude-poorest.html?pagewanted=all

    http://www.nytimes.com/2013/05/27/us/politics/polarized-congress-thwarts-changes-to-health-care-law.html?hp&_r=0&pagewanted=all

    Sammy Finkelman (d22d64)

  17. This is akin to the bankruptcy petitioner who, en route to the courthouse, rejoices that he found a quarter in the seat cushions that morning.

    Beldar (51ea06)

  18. In hyperinflation, the average income goes up about 25% as well.

    so this is just a housing bubble then

    i hate housing bubbles

    happyfeet (c60db2)

  19. He had an ARM pikachu,

    narciso (3fec35)

  20. Cutting tax rates would probably lead to increased revenues, especially if it were combined with other economically sensible actions like not borrowing $100b to build a railroad almost no one will use and that will require ongoing tax support until who knows when.

    MT Geoff (a67ef4)

  21. Desperately Seeking Browndom!

    It is just too funny the lengths the NYT will go to deflect scrutiny away from the failures of The Left.
    But, enough about the writings of Krugman and Friedman (and please don’t get me started on MoDo, I’m having too nice a day).

    askeptic (b8ab92)

  22. Comment by JVW (23867e) — 5/28/2013 @ 9:31 am

    You mean, like L.A. and her new Mayor, Eric Garcetti, are facing in the aftermath of Tony Villar?

    askeptic (b8ab92)

  23. We need to spend more money in order to get out of debt. Or something.

    Elephant Stone (6a6f37)

  24. No wonder conservatives never get invited to the parties with the cool kids…

    Can’t we celebrate our windfall like the libs? I mean we still have a few years before we drop right off the fiscal cliff. Come on, everybody whistle “Don’t Worry, Be Happy” and enjoy the walk on the sunny side of the street for a change. Sheesh!

    in_awe (7c859a)

  25. You’re tilting at windmills here. Trying to get the extreme left-wing bias out of the NYT only would be slightly less difficult than trying to get all the corruption out of Chicago, all the crime out of Philly and all the poverty out of Detroit. The other germane point is that liberal idiots (BIRM) who write for the NYT and who edit that paper wouldn’t know the basics of public finance and economics if you sat down and explained those precepts to them, using a flow chart and a puppet show.

    Regarding California’s financial situation it truly is catastrophic. The state owes far more money that it ever could repay. And when interest rates in the broader bond markets inevitably spike and California’s debt service follows suit it’ll make Orange County circa ’95 look like a walk in the park. Not that the effete space cadets in the liberal media will know or care about it. They’ll be too busy preening at cocktail parties, counting their trust fund monies.

    William Scalia (4fc30a)

  26. Our state needs to go on a diet.

    Elephant Stone (6a6f37)

  27. This is akin to the bankruptcy petitioner who, en route to the courthouse, rejoices that he found a quarter in the seat cushions that morning.

    Comment by Beldar (51ea06) — 5/28/2013 @ 9:50 am

    Winning…

    Tanny O'Haley (1df9d3)

  28. Comment by happyfeet (c60db2) — 5/28/2013 @ 9:33 am

    If I had to pick I would permanently monitor feet’s comments.

    I do not find voicing preferences over who you would like to violate one of your minor children very funny nor enlightening,
    just disgusting.

    MD in Philly (3d3f72)

  29. he must be thinking of monroe louisiana

    there are large swathes of it what smell like cabbage and almost all of it is dirty poor and decrepit

    their downtown was absolutely pitiful and dead and neglected except for there’s a restaurant I would love to try someday called cotton

    http://www.urbanspoon.com/r/224/1633810/restaurant/Cotton-Monroe

    happyfeet (c60db2)

  30. I think most people would agree with my logics there Mr. Dr.

    the truth what I speak it is a lot unvarnished sometimes

    but that just helps you see the natural color of the wood more better and you still have the option of slapping some primer on it and going with a jaunty bold primary color instead of just a stain or whatever

    happyfeet (c60db2)

  31. This is exactly what people need to read when they falsely claim Reagan helped the economy. Revenue and job numbers all went up but there was an exploding federal deficit counterbalancing any bit of progress which would would be accruing interest for generations.

    For decades, Republicans have been crowing about Reagan’s effectiveness as the ultimate fiscal conservative, claiming he increased revenues by LOWERING taxes on those who make the most. Magic, right?

    Patterico astutely noticed the NYT trying to hornswoggle the public in the same way, bleating on about CA’s improvements under Jerry Brown while burying the ugly truth about it’s long term obligations under the carpet.

    If he had principles, Frey could substitute Reagan for Brown and the US for CA to help the right face historic reality. But because of the partisan blinders worn by Reagan-worshipping sycophants, we instead choose to do exactly what Frey exposed above – look selectively at statistics, to put lipstick on a pig. Reagan’s deficits outgrew and outlived any progress he made with his policies, making any praise of them meaningless.

    If you were consistent, you’d mention the same thing was plaguing Texas, Ohio, Michigan and plenty of other states whether red, blue or purple. But because this is a watering hole for folks intentionally looking for half the story, this is just another day at the office.

    Why is this important? Reaganomics theories are being defended today, with people arguing vehemently for less taxes on the rich and more deregulation on banks and industry. Adding to the deficit since 2001, the Bush tax cuts were in place in 2008 when the economy collapsed.

    Today we only have half the spending power of our dollars, meaning Obama, McCain, Romney or anyone else entering the White House will fail again and again until we eliminate both the debt and the deficit.

    Here’s a headline, based on Patterico’s solid logic that we should see nationally:

    Republican Claims About Reagan Economic Gains Ignore Crushing US Debt

    Mahalia Cab (c3784d)

  32. Mahalia Person, it sounds like you really have it out for the proprietor of this website.
    While the rest of us refer to him as “Patterico,” you always call him by his real name.

    Just out of curiosity, did he prosecute you or someone you support ?

    Elephant Stone (6a6f37)

  33. #33

    A large part of the increased deficits under Reagan was because of the recession which exploded the deficit in the first three years. Once the recession began subsiding so did deficits. The increased defense spending also added to the deficits but they helped win the cold war, leading to REDUCED defense spending, which allowed Clinton to look like a fiscal conservative.

    Gerald A (82a59d)

  34. Mahaliar Cab #33 – It is well-documented that Reagan tax and business policy brought in significantly increased revenue stream over the 8 years of his Presidency … and it is well-documented yet seldom disseminated that spending by the Democrat-controlled Congress significantly outspent the well-documented increased revenue …

    I know you don’t like anyone pointing that out, but, what the hey … into every life a little reality must fall …

    Alasdair (867c8a)

  35. Mahalia wallows in her ignorance.

    JD (df45ac)

  36. Mahalia :

    1) Bush 43 began his term with a recession that started in the last quarter of the clinton administration, then 9/11 hit. The bush tax cuts began kicking in during 2002 and the deficit began closing significantly until congress was taken over by the Dems in 2006 and which time the deficit began to explode.
    2) You incorrectly imply the that financial crisis which sparked the 2008 recession was due to the policies of bush 43 and the bush tax cuts. The financial crisis was born of a money bubble, similar to the housing bubble and the student loan bubble. It has nothing to do with the excessive of wall street or the policies of bush.

    Joe (debac0)

  37. Comment by narciso (3fec35) — 5/28/2013 @ 12:58 pm

    Geography is soooo tough!

    Wonder when he’s going to vacation in the Maldives?

    askeptic (b8ab92)

  38. an exploding federal deficit

    The current occupant of the WH would die for a deficit that “exploded” on such a non-massive scale.
    BTW, what global evil-network is this President fighting to overcome?
    At least Reagan “defeated” the Soviet Union – “We Win, they Lose!”
    This Empty-Suit wants to unilaterally declare a war over while our opponent is still trying to kill us.

    askeptic (b8ab92)

  39. the only surplus California consistently runs is stupidity, which can be found in Sacramento and other locations where politicians & lobbyists gather, such as LA city hall…

    and in the homes of the idiots who keep voting for such fools to begin with.

    redc1c4 (403dff)

  40. The Stupid is strong on the West-Side of L.A.

    askeptic (b8ab92)

  41. re comments 5, 6, & 14, the NYT stuffs it into a lovely, Orwellian illusion in graf 6:

    The debate reflects uncertainty about whether the revenue is a one-time event, a result of state taxes on wealthy residents selling off investments at the end of last year to avoid increased costs as the Bush-era federal tax cuts expired.

    Ah yes… increased “costs” from expiring tax rates. Sounds so much better than admitting the rich took capital gains ahead of higher tax rates, becauuse that would be an admission that tax rates drive behavior.

    And how “debatable” is this? I’d love to hear Gov. Moonbeam (or anyone, really) explain how George Lucas sells his Empire to Disney again this year.

    Karl (5f6b7a)

  42. I meant “allusion,” but “illusion” kinda works there also.

    Karl (5f6b7a)

  43. Sounds like much the same thing that happened here (New Zealand) in the 90s.

    The government had slashed benefits to the bone and sure enough, a couple of years later the books started to balance.

    Queue immediate chorus of groups screaming for “their” cut.

    Luckily the government ignored them and used it to pay back debt, and cut taxes a little. This created a virtuous circle which the next government then took credit for, while subtly allowing more inflation and refusing tax cuts even when surpluses were overwhelming.

    scrubone (e7e0ea)

  44. If the “average new monthly mortgage payment is up $234 (+26%) over last year” (#3), that doesn’t necessarily mean hyperinflation, because very few of this year’s buyers also bought a house last year. What it more likely means is that more upper-middle-class and upper-class people and fewer lower-middle-class people bought houses this year than last. In other words, in Obamaland, particularly in the Brown City section, the rich (union leaders, politicians, friends and relatives of politicians) get richer while the poor get poorer. Or at least the working poor get poorer – I suspect the non-working poor are doing just fine, materially at least.

    Dr. Weevil (841ed6)

  45. Patterico : Mahalia Cab :: astute : ass toot

    Dr. Weevil (841ed6)

  46. The articles ignore two big things:

    1. The state took forced loans from cities and counties out of property tax revenue and needs to pay that back.

    2. Retroactive tax captured revenue from previously filed taxes going back to 2008.

    They do mention people taking profits in 2012 to avoid 2013 tax rates but that isn’t the only issue at work here.

    The state must pay back the cities and counties for property tax revenues it took by force of law.

    crosspatch (6adcc9)

  47. Did Krugman write this load of CRAP. What kind of moron would suggest that California has too much money?

    Oh yeah, A LIBTARD would.

    This is fecking nonsense, concocted and designed for the LIV.

    Gus (694db4)

  48. 48. And lest anyone think the cavalry even exists anymore, 10-year T-Bill finished at 2.14% today, highest in ages, with the Fed buying the whole lot in two weeks.

    This despite the fact collateral is hard to come by these days for loans of any sort.

    Cash is looking worthless these days and bonds worth less.

    gary gulrud (dd7d4e)

  49. ) Bush 43 began his term with a recession that started in the last quarter of the clinton administration, then 9/11 hit. The bush tax cuts began kicking in during 2002 and the deficit began closing significantly until congress was taken over by the Dems in 2006 and which time the deficit began to explode.

    Can you imagine what might have happened if those tax cuts didn’t happen, but the internet-bubble recession, the Gore election intifada and 9/11 did? Of course the resulting meltdown would have been blamed on Bush, not Clinton-Gore.

    Kevin M (bf8ad7)

  50. Politics and ideology aside — and, yea, coming from me I know that does sound sarcastic — but Brown did institute one large change that his predecessors, or politicians from across the spectrum, would have, or have long, resisted doing. He eliminated urban redevelopment agencies throughout the state. That caused property tax monies previously funneled into those agencies (known as CRAs) — and which supported all their employees and real-estate projects — and routed it into other parts of the state’s budget.

    Some redevelopment activity in past decades has been good, and at least in various cases resulted in specific, tangible improvements to a community. But that part of government also was being abused, or overused, with dollars sometimes set aside for sweetheart construction deals, or sent down the drain for low-income housing (or examples of the road to hell being paved with good intentions). However, that facet of local government was not as bad as Solyndra-type wastefulness, since, again, at least changes to a community through CRAs could be tangible and generally permanent.

    It may not matter one way or the other, because I suspect that California faces a future where its economy and social scene will increasingly resemble a mixture of Mexico, Venezuela, Greece and Argentina.

    A joyous tomorrow for all.

    Mark (aa8ab9)

  51. An unexpected surplus is fueling an argument over how the state should respond to its turn of good fortune.

    What?

    Spend it like a teenaged girl with Daddy’s gold card at a boutique mall” wasn’t the instant choice…?

    Really?

    Smock Puppet, Reactionary Thug and Bon Vivant (83082b)

  52. Gerald, your excuse-making for Reagan is bald and wanting. If there was a recession during most of Reagan’s first term, but it has nothing to do with his economic policies, why, that would mean Obama is not to blame either for this recession. This is your logic. Is that what you’re saying?

    I get that you think Reagan’s defense spending won the cold war, but it plunged us into spiraling deficits. Russia’s downfall was economic, following 10 years of waging war in Afghanistan to no avail. Reagan can take credit for outspending and outlasting Russia in an arm’s race, but the debt only hamstrung the next administration, and the one after that and so on. Reagan could have done the base closures all over the world that Clinton did if he believed a balanced budget was a priority. He didn’t, and the record shows this. Reagan’s alliances with Saddam and bin Laden also came back to haunt this country, where an non-interventionist policy would have kept us out of the fray like Canada or the Swiss. It was a massive blunder to tie our fortunes to Middle East oil that we are paying so much for.

    Clinton/Gingrich lowered taxes for the middle class through the EITC which led to balanced budgets. Reagan believed in lowering taxes for the wealthy and no amount of excuse-making can cover for the results – revenue increases to charm the fools on the one hand but deficits as far as the eye can see. Reagan approved and signed the compromise bills WITH the Democrats, so he not only owns the bloated defense spending but the spending on the lilly-livered liberal social programs as well.

    Read up on the “Two Santa Clauses” to learn all about what Reagan’s budget expert Jude Wanniski felt was the key to winning elections – spending money we didn’t have. Reagan’s signature was on every one of those bills, so your attempt to convince me the bad spending was “all Democrat” failed. The bottom line speaks for itself – Reagan increased the debt by trillions, period.

    Alasdair, I already mentioned that Reagan’s policies increased revenue, but just like Patterico points out with CA, that stat by itself is supposed to distract the gullible. Since you are smart, you know that the federal deficit also surged under Reagan, so everything good was wiped out, and more – we are still paying off Reagan’s deficits with interest, as well as the debt generated under the presidents. Our ability to spend today is hampered because over 50 cents of every dollar goes to service past debt. The only way someone can possibly believe Reagan did ANYTHING good by lowering taxes on the wealthiest taxpayers is if we close our eyes real, real tight and ignore the deficits.

    I see you are like Gerald, trained to try to believe somehow revenue generated while deficits grew is a net positive, but it’s NOT.

    You also cannot separate it into spending by party because the only way an appropriation bill becomes law is with the signature of the President. So if the Democrats were taking billions to give directly to black welfare queens, Reagan needed to veto it. He did not – can you explain for all your friends why? Research it and you’ll learn that he crafted deals with Speaker Tip O’Neill so both sides got everything they wanted, a la the Two Santa Clauses.

    It’s also worth noting that defense spending, which is less economically stimulative, was GREATER than the social spending, which is more economically stimulative.

    To Joe, the same thing goes for Bush 43. If there was a spending bill that passed Congress and became law, Bush signed it when he could have vetoed it. That means he owns it and if he knew this was going to reflect on his legacy. But since you ALSO think that the spending that happened under Republican presidents was the fault of Congressional Democrats, I’d like to challenge you – which of the two parties was the greater proponent behind the two wars, Medicare part D and the unfunded Bush tax cuts for the rich that promised jobs but failed to deliver? Because those comprise significant portions of the 4+ trillion spent under Bush.

    WRONG, I did not “imply” that the economic crisis was a result of the Bush tax cuts, I “implied” quite clearly above that it was a result of deregulation, a principle pillar of Reaganomics.

    Your belief that the crisis was borne (not born) of a “money bubble” is hysterical, it’s like a grade school definition. In fact it was due to mass defaults in the sub prime mortgage securities markets which was the small domino that knocked down the larger ones – derivatives, credit default swaps and collateralized debt obligations worth hundreds of billions. All bets taken out that came due while the financial institutions didn’t have the assets to cover them. Then we found out the securities were intentionally created to fail, by bundling thousands of “liars” loans which never should have been issued – this represents massive fraud that took place in an unregulated, unmonitored environment during the Bush administration as white collar investigators and prosecutors were moved out of the financial sector into the DHS, even after they reported to the White House that 80% of the tainted mortgages involved fraud on the part of the originator.

    The premise stands – everything Patterico says above about California can be applied to Republican debt spending in the exact same way.

    Mahalia Cab (c2b8c1)

  53. R.I.P. Jack Vance, Science Fiction Grand Master

    Icy (76748a)

  54. someone tell Mahalia that the full moon was last week…

    redc1c4 (403dff)

  55. Malia

    WRONG, I did not “imply” that the economic crisis was a result of the Bush tax cuts, I “implied” quite clearly above that it was a result of deregulation, a principle pillar of Reaganomics.

    The financial crisis had nothing to with deregulation. One of most misunderstood causes of the financial crisis of 2008 and one of the constant whipping boys for the dems to attempt to exploit. The financial crisis was caused by too much money in the system.

    joe (93323e)

  56. Morgenstern, in that very slim volume, cut to the chase re the CRA revisions, which created the demand for all this subprime debt, that Fannie and Freddie recycled,

    narciso (3fec35)

  57. malia

    Your belief that the crisis was borne (not born) of a “money bubble” is hysterical, it’s like a grade school definition. In fact it was due to mass defaults in the sub prime mortgage securities markets which was the small domino that knocked down the larger ones – derivatives, credit default swaps and collateralized debt obligations worth hundreds of billions.

    Your response shows the a very shallow understanding of the financial crisis. All the problems you mention occur after too much money enters the system, not before. All the problems you mention occur after the money bubble.

    Can you explain how deregulation causes a money bubble.

    joe (93323e)

  58. Just heard right now on KCBS radio: Californians like the job that Jerry Brown is doing.

    Blacque Jacques Shellacque (bed55d)

  59. Just heard right now on KCBS radio: Californians like the job that Jerry Brown is doing.

    Wouldn’t surprise me. The idiots who voted for him in the first place probably love everything he’s done, and want more of the same. “Thank you, Sir, please may I have another?”

    Milhouse (3d0df0)


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