Authored by Wolf Richter via WolfStreet.com,
Breath-taking differences in a vast country.
The Census Bureau released another data trove this week for 2016, based on the American Community Survey. Among many other data points, the survey details median household incomes by geographic location, such as by metro area, county, or state. And they show just how enormous the income differences in the US are from city to city.
A few days ago we highlighted the reckless efforts of the San Francisco Board of Supervisors to force their city's pension managers to ignore their fiduciary duties and dump nearly $500 million worth of energy stocks. Of course, the pressure to sell had nothing to do with financial projections, trading multiples or discounted cash flow analyses but rather was a blatant and irresponsible attempt to push the board's political agenda irrespective of the ultimate financial consequences such actions might have to pensioners and tax payers (see: What Fiduciary Duty?
While we've yet to experience any large municipal pension failures, which is just a matter of 'when' rather than 'if', the small pension failures sprinkled across the state of California are starting to pile up. As The Sacremento Bee points out today, public workers in Trinity and Imperial counties are just the latest to have their pensions slashed by up to 90% as their cities admit what most of us have known for some time, namely that they're running ponzi schemes which simply don't have the funding required to payout the benefits they've promised.
Authored by Charles Hugh Smith via OfTwoMinds blog,
Yes, this time it's different: all the foundations of a healthy economy are crumbling into quicksand.
Authored by Nick Giambruno via InternationalMan.com,
Public pensions are a financial time bomb... and I see two ways to profit from the explosion.
In the US, unfunded public pension liabilities have surpassed $5 trillion. And that’s during an epic stock and bond market bubble.
Predictably, the government’s go-to “solution” is already making matters worse.
At first, distressed states simply increase taxes.