The Coming Muni Meltdown

[denner]

Quote from achilles28:

Municipalities and States are near the end of their rope and desperate for cash to fuel their extravagant budgets and salaries. Bonds are headed south, so they intend to kill the golden goose to stave off the wolves.

The problem is spending. Tax hikes will go to firm up balance sheets to enable further looting. While doing so, the productive sector - ie, the real economy - gets squeezed harder and private consumption drops, hastening the very thing they want to avoid: declining tax revenues.

Their ace in the hole is the FED. Comptrollers across America know the FED will aggressively intervene with QE X if and when the country goes head first into another deflationary spiral. Which it will most certainly if all municipalities impose caviar-austerity. It's pretty much a lock Fuckhead will monetize State and Muni debt and in doing so, send commodities north again. The stock market definitely is bullish, but it's upside is really dependent on how bad the austerity goes. This is banana republic economics with a soon-to-follow toilet bowl currency. The bailouts can't continue without putting the dollar through the ringer. When the US consumer recovers, that's when the shit hits the fan. The average debt maturity is too short and too big to raise rates. Same for consumers. Fuckhead won't let the banks fail so it's buy buy buy and hope u beat the averages. I hear oil is going back to 150$-200$ soon.

Americans have no one to blame but themselves. They voted these criminals into office so they could share a place at the table, feasting on the taxpayers meaty carcass. Now it's done and there's nothing left to eat but each other. So many greedy cowards in this Country it's fucking incredible. No morals, no work ethic, no ingenuity. Just rob and fuck the average hard working American. Really unbelievable.

Agree 100% with everything except for the last paragraph. IMO, the system or rather ideal of democracy is irrevocably broken and has been for quite some time. There are numerous examples to cite of wildly unpopular laws, bills, actions taken "for the benefit" of the general populace that are nothing more than further enslavement, for lack of a better term.

You did hit the nail on the head with regards to the 180k for retired teachers vs salaries for the younger generation and, most importantly, how upside down this ponzi system has become. The moral hazard play is just so completely embedded into this system now, that literally the entire fabric of the economy is just a front running of bailouts for every sector.

After the shitstorm that everybody lived thru 2-3 years ago, I had this naive notion that perhaps more people would awake to what a scam all of this was. I suppose more people are aware of it, but they are well behind the curve in so far as actually believing it to be true. I think the very core fabric of some people's belief systems have been rocked to the core (the kind of fools who think that everything non-mainstream is a conspiracy). Well, now they're becoming tuned into the fact that it's a completely unsustainable situation.