A grim lesson in retirement reality for US states

I’ve warned before about pension shortfalls in the USA, particularly in government pensions.  I’ve also warned about the dangers of too much debt, whether governmental, corporate or personal. Puerto Rico has just become a case study in what happens when the two problems intersect. When [Puerto Rico] declared bankruptcy in 2017, it was the biggest bankruptcy case in US history … So there’s been more than two years of negotiation between bondholders and all the various officials, pensions, unions, etc. And on Friday they announced the deal. Bondholders will take a huge cut of more than 60%. But, as part of

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Again I say: if you live in Illinois, LEAVE!!!

We’ve spoken more than once about Illinois’ financial woes in these pages, and Chicago’s in particular.  Now comes news that the situation is far worse than previously reported, because generally accepted accounting principles were not followed. The State of Illinois recently reported its biggest annual financial loss ever. Instead of clear reporting on that, we’ve seen perhaps the most glaring example yet of how the state’s finances can be misunderstood, misreported and intentionally distorted. The loss of $47 billion for the state’s 2018 fiscal year, shown in audited financial statements released late last month, is an astonishing number. For some perspective,

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In the history of shopping, Amazon.com isn’t as new as it seems

Being an immigrant, I wasn’t as familiar with US economic history as I was with that of other countries and regions.  Therefore, I found this article, comparing Amazon.com with a much earlier vendor, very interesting. The history of US consumerism starts with the Sears Roebuck mail order catalog. Yes, the very same Sears that is struggling to emerge from bankruptcy today. But 125 years ago the company was every bit the disruptive innovator. A brief summary of how that happened: Mail order became viable in the late 1800s because of the expansion of the US rail system, post office regulations that allowed for

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Unintended consequences – the Cobra Effect

I was amused to read this article at the Foundation for Economic Education’s web site. In colonial India, Delhi suffered a proliferation of cobras, which was a problem very clearly in need of a solution given the sorts of things that cobras bring, like death. To cut the number of cobras slithering through the city, the local government placed a bounty on them. This seemed like a perfectly reasonable solution. The bounty was generous enough that many people took up cobra hunting, which led exactly to the desired outcome: The cobra population decreased. And that’s where things get interesting. As the cobra

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Karl Denninger’s Presidential platform – there’s some good stuff here

The inimitable Karl Denninger has published what he’d do if he were drafted to be President.  Based on what I see there, I’d draft him tomorrow!  Examples: 100% E-Verify now.  All employers have six months to comply for existing employees, all new hires must have it run.  Liability is personal and cannot be thrown off on a staffing company or other scheme.  All 941s (quarterly withholding filings) must include E-Verify control numbers on them.  Congress will receive a bill on my first day in office to upgrade failure to include same on 941s, hiring or paying people without reporting accurately on same, or any

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So why are they still charging fees?

It seems some American universities and university systems can only be described as “stinking rich“. There are 195 countries in the world, and over half of them are poorer than Harvard University. The Ivy League institution’s 2018 endowment was $38.3 billion, according to Stacker. This amount exceeds the wealth of any of more than half of the 195 countries around the world. . . . Campus Reform reached out to Harvard for a breakdown of funding allocation and to see what the school thought of the college vs. countries statistic, but received no comment in time for publication. With a

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When ethics and morals drive corporate governance

Many corporations appear to be rethinking their role in society, and in the process losing their focus on the original reason(s) for their existence. The purpose of a corporation is to serve all of its constituents, including employees, customers, investors and society at large, the Business Roundtable said Monday in a statement. Jamie Dimon, CEO of JPMorgan Chase & Co., heads the group. “While each of our individual companies serves its own corporate purpose, we share a fundamental commitment to all of our stakeholders,” the group said in the statement. “Americans deserve an economy that allows each person to succeed through

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The politically manufactured anti-Trump “recession”

I’m sure readers have noticed the sudden drumbeat of “Economic recession!  We’re doomed!” headlines and articles all over the country.  They were so simultaneous and so contrived that it was obvious they were being coordinated by a single source.  The Gormogons laid it out neatly. If only there were a way to defeat Trump’s economic record. Early attempts to dismiss it as a Potemkin boon only benefiting the ultra-wealthy—you saw this in the Democrat debates—didn’t jive with the fatter paychecks lower class and lower middle class folks were finally depositing in parched bank accounts. Time for the Ultimate Weapon: in order

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There’s no fuel like an oil fuel

. . or so the petroleum industry used to say, back in the 1970’s.  That’s proving true in the maritime shipping industry right now, as major change looms next year.  We don’t think much about an industry that’s “out of sight, out of mind” for most of us, but it has a huge impact on global pollution, and changing that is going to require major changes to the way we fuel the ships that fuel the world’s economy.  Forbes reports: A United Nations mandate on the shipping industry to remove up to 85% of the sulfur content from its fuel to cut 3%

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Early warning signs that Mexico may follow Venezuela’s example?

American Thinker notes two worrying developments in Mexico. We try to stay in touch with Mexico.  This week, we saw a couple of articles that should worry the Mexican middle class. First, Presidente López-Obrador is making investors a bit weary, according to Richard Castillo via Pulse News Mexico: Fear does not ride on a burro; it flies at the speed of sound! And spreading fear of President Andrés Manuel López Obrador’s (AMLO) economic policies seems to be the leading reason that Mexico’s Gross Domestic Product (GDP) has slumped markedly to the point of reaching a minimal growth of 0.1 percent for the

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