OT: No bailout for California

[j]

Many other states besides California have budget problems, and they do not have Prop 13.

While Prop 13 does affect the budget, the crazy government way of spending money is the real problem. In government budgets not increasing spending is a cut in spending?

[LuckyInOC]

At 3.75% annual return, wouldn’t California IOU’s be better than current CD’s right now for investment purposes?

Also…

1. State issues registered warrants @ 3.75% interest.
2. Major banking institutions will accept the registered warrants as cash.
3. Major banks can borrow money from the Fed at 0% or use TARP money to cover these warrants.
4. Major banks cash in warrants in Oct’09.
5. State of California gets Govt bail out indirectly.
6. State Congress delays even more because debt has been financed….

What is the risk? California going BK?
Would the registered warrants be redemable?

Does anyone have about $200-300k of registered warrants they want to sell?

Luck In OC

[LuckyInOC]

At 3.75% annual return, wouldn’t California IOU’s be better than current CD’s right now for investment purposes?

Also…

1. State issues registered warrants @ 3.75% interest.
2. Major banking institutions will accept the registered warrants as cash.
3. Major banks can borrow money from the Fed at 0% or use TARP money to cover these warrants.
4. Major banks cash in warrants in Oct’09.
5. State of California gets Govt bail out indirectly.
6. State Congress delays even more because debt has been financed….

What is the risk? California going BK?
Would the registered warrants be redemable?

Does anyone have about $200-300k of registered warrants they want to sell?

Luck In OC

[LuckyInOC]

At 3.75% annual return, wouldn’t California IOU’s be better than current CD’s right now for investment purposes?

Also…

1. State issues registered warrants @ 3.75% interest.
2. Major banking institutions will accept the registered warrants as cash.
3. Major banks can borrow money from the Fed at 0% or use TARP money to cover these warrants.
4. Major banks cash in warrants in Oct’09.
5. State of California gets Govt bail out indirectly.
6. State Congress delays even more because debt has been financed….

What is the risk? California going BK?
Would the registered warrants be redemable?

Does anyone have about $200-300k of registered warrants they want to sell?

Luck In OC

[LuckyInOC]

At 3.75% annual return, wouldn’t California IOU’s be better than current CD’s right now for investment purposes?

Also…

1. State issues registered warrants @ 3.75% interest.
2. Major banking institutions will accept the registered warrants as cash.
3. Major banks can borrow money from the Fed at 0% or use TARP money to cover these warrants.
4. Major banks cash in warrants in Oct’09.
5. State of California gets Govt bail out indirectly.
6. State Congress delays even more because debt has been financed….

What is the risk? California going BK?
Would the registered warrants be redemable?

Does anyone have about $200-300k of registered warrants they want to sell?

Luck In OC

[LuckyInOC]

At 3.75% annual return, wouldn’t California IOU’s be better than current CD’s right now for investment purposes?

Also…

1. State issues registered warrants @ 3.75% interest.
2. Major banking institutions will accept the registered warrants as cash.
3. Major banks can borrow money from the Fed at 0% or use TARP money to cover these warrants.
4. Major banks cash in warrants in Oct’09.
5. State of California gets Govt bail out indirectly.
6. State Congress delays even more because debt has been financed….

What is the risk? California going BK?
Would the registered warrants be redemable?

Does anyone have about $200-300k of registered warrants they want to sell?

Luck In OC

[ucodegen]

@LuckyInOC

3. Major banks can borrow money from the Fed at 0% or use TARP money to cover these warrants.

The TARP money does not cost 0%. Last quarter, BofA paid over $400Mil on interest alone (per quarter) on the TARP money they borrowed. Its in their 10Q. ($400M * 4Q)/$45B = 3.555% interest. Banks don’t want to risk it because of the risk of default. It is not money-good.

[ucodegen]

@LuckyInOC

3. Major banks can borrow money from the Fed at 0% or use TARP money to cover these warrants.

The TARP money does not cost 0%. Last quarter, BofA paid over $400Mil on interest alone (per quarter) on the TARP money they borrowed. Its in their 10Q. ($400M * 4Q)/$45B = 3.555% interest. Banks don’t want to risk it because of the risk of default. It is not money-good.

[ucodegen]

@LuckyInOC

3. Major banks can borrow money from the Fed at 0% or use TARP money to cover these warrants.

The TARP money does not cost 0%. Last quarter, BofA paid over $400Mil on interest alone (per quarter) on the TARP money they borrowed. Its in their 10Q. ($400M * 4Q)/$45B = 3.555% interest. Banks don’t want to risk it because of the risk of default. It is not money-good.

[ucodegen]

@LuckyInOC

3. Major banks can borrow money from the Fed at 0% or use TARP money to cover these warrants.

The TARP money does not cost 0%. Last quarter, BofA paid over $400Mil on interest alone (per quarter) on the TARP money they borrowed. Its in their 10Q. ($400M * 4Q)/$45B = 3.555% interest. Banks don’t want to risk it because of the risk of default. It is not money-good.

[ucodegen]

@LuckyInOC

3. Major banks can borrow money from the Fed at 0% or use TARP money to cover these warrants.

The TARP money does not cost 0%. Last quarter, BofA paid over $400Mil on interest alone (per quarter) on the TARP money they borrowed. Its in their 10Q. ($400M * 4Q)/$45B = 3.555% interest. Banks don’t want to risk it because of the risk of default. It is not money-good.

[Author]

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