Posts Tagged ‘New Jersey’

The SEC Charges New Jersey With Fraud… Oh, and Nothing Happens as a Result

The SEC Charges New Jersey With Fraud… Oh, and Nothing Happens as a Result

Courtesy of Jr. Deputy Accountant 

OK now I have officially had enough with this settlement bullsh*t. The state of New Jersey is allowed to lie about pension funding and defraud investors, and isn’t even levied a penalty? That’s not a slap on the wrist, it’s a slap in all of our faces.

Basically all it means for NJ is that they can’t sell these crap bonds anymore. Way to regulate, you lazy, toothless **cks. Now what about the idiots who invested in this crap? Throw them on the pile with the rest of New Jersey’s creditors?

The NYT has the story:

The Securities and Exchange Commission accused the State of New Jersey of securities fraud on Wednesday for telling the bond markets that it was properly funding state workers’ pensions when it was not, The New York Times’s Mary Williams Walsh reports.

As a result, the S.E.C. said in a cease-and-desist order, investors bought more than $26 billion worth of New Jersey’s bonds, without understanding the severity of the state’s financial troubles. New Jersey, the S.E.C. said, has agreed to accept the order, without admitting or denying the finding. The agency did not impose a financial penalty.

Wednesday’s action was the first time the federal agency has accused a state with violating securities laws. The S.E.C.’s powers of enforcement against the states are tightly limited by states’-rights concerns and constitutional law, and it has standing to get involved only when there is a clear-cut case of fraud.

“The State of New Jersey didn’t give its municipal investors a fair shake, withholding and misrepresenting pertinent information about its financial situation,” Robert Khuzami, director of the S.E.C.’s division of enforcement, said in a statement. The cease-and-desist order named only the State of New Jersey, and not the financial institutions that helped it issue the bonds. Its largest bond underwriters during the period in question include Citigroup, JPMorgan Chase, Morgan Stanley, Bank of America, Merrill Lynch, Goldman Sachs and Barclays Capital.

Well who cares, even if they did name banks by name it’s not like they’d actually DO anything about it, right? Maybe they priced in a few million extra when they last settled with EACH of those banks for financial misdeeds.  

I don’t feel sorry for the investors, actually, since this is what…
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State Budgets: Serious, Ridiculous, Ugly

State Budgets: Serious, Ridiculous, Ugly

Courtesy of John Rubino, Dollar Collapse 

This week the focus shifted from Europe, where (apart from the French World Cup team) things are quiet, to the US, where state budget deadlines are forcing some tough, and occasionally bizarre, choices. Time Magazine’s cover, for instance blares The Broken States of America. An excerpt:

… Almost no one — and no place — is exempt. Nearly everywhere, tax revenue plummeted as property values tanked, incomes dwindled and consumers stopped shopping. Falling prices for stocks and real estate have made mincemeat of often underfunded public pension plans. Unemployed workers have swelled the demand for welfare and Medicaid services. Governments that were frugal in the past are just squeaking by. Governments that were lavish in the good times, building their budgets on optimism and best-case scenarios, now risk being wrecked like a shantytown in an earthquake.

How the Money Ran Out
For the first time in four decades of collecting data, the National Governors Association (NGA) reports that total state spending has dropped for two years in a row. In hard-hit Arizona, for example, the state budget has sagged to 2004 levels, despite blistering growth in population and demand for government services. Starting with the 2008 fiscal year, state governments have closed more than $300 billion in cumulative budget gaps, with another $125 billion already projected for the coming years, says Corina Eckl, fiscal-program director at the National Conference of State Legislatures (NCSL). Similar figures aren’t collected for the nation’s counties, villages and towns, but when the National League of Cities surveyed mayors recently, three-fourths of them described worsening economic conditions.

Accustomed to the ups and downs of the ordinary economic cycle, elected officials and budget planners are facing something none of them have experienced before: year after year of shortfalls, steadily compounding. Ordinarily, deficits are resolved mostly through budgetary hocus-pocus. But the length and depth of the recession are forcing governments to go beyond sleight of hand to genuine cuts. And that makes lawmakers gloomy in all but a handful of states. (It’s a swell time to be North Dakota.) According to an NCSL survey, worry or outright pessimism is the reigning mood in the vast majority of capitals.

And here’s a brief look at how some states are dealing with their deficits, starting with California:

A three-way stalemate over California’s budget


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Inside the Dire Financial State of the States

Inside the Dire Financial State of the States

By David von Drehle, courtesy of TIME 

Ellen Weinstein for TIME 

In New Jersey, taxes are high, the budget’s a mess, government is inefficiently organized, and the public pension fund is blown to kingdom come. Which makes New Jersey a lot like most other states in 2010. What makes the state unusual is its rookie governor, a human bulldozer named Chris Christie, who vowed to lead like a one-termer and is keeping his promise with brio. He has proposed chopping $11 billion from the state’s budget — more than a quarter of the total — for fiscal year 2011 (which starts July 1). He’s backing a constitutional cap on property taxes in hopes of pushing the state’s myriad villages and townships to merge into more efficient units. He’s locked in an ultimate cage match with the New Jersey teachers’ union. It may be the bitterest political fight in the country — and that’s saying something this year. A union official recently circulated a humorous prayer with a punch line asking God to kill Christie. You know, New Jersey humor. And in an interview with the Wall Street Journal, Christie didn’t talk about the possibility that his fiscal initiatives might be compromised or defeated; he pictured himself "lying dead on State Street in Trenton," the state capital. Presumably that was a figure of speech.

The tone of the New Jersey budget battle may be distinctive, but many of the same notes can be heard in state capitals across the country. From Hartford to Honolulu, once sturdy state governments are approaching the brink of fiscal calamity, as the crash of 2008 and its persistent aftermath have led to the reckoning of 2010. Squeezed by the end of federal stimulus money on one hand and desperate local governments on the other, states are facing the third straight year of staggering budget deficits, and the necessary cuts will cost jobs, limit services and touch the lives of millions of Americans. Government workers have been laid off in half the states plus Puerto Rico. Twenty-two states have instituted unpaid furloughs. At least 28 states have ordered across-the-board budget cuts,…
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15,000 Illinois Protesters Chant “Raise My Taxes”

15,000 Illinois Protesters Chant "Raise My Taxes"; Unions Getting More Aggressive and Obnoxious; Record Turnout in N.J. Tells Unions to Go to Hell

Courtesy of Mish 

In Illinois, union protesters staged a huge rally in Springfield, demanding higher taxes for their self-serving agenda.

Please consider Thousands of protesters at Illinois Capitol to press for tax increase.

Thousands of protesters bused down by labor unions and social service advocates rallied at the Capitol today in an attempt to pressure state lawmakers into raising the income tax to avoid more budget cuts.

A spokesman for Illinois Secretary of State Jesse White estimated the rally crowd at 15,000, with more than 12,000 marching around the building. That would appear to make it the largest Capitol protest since the Equal Rights Amendment crowds a quarter-century ago.

Bus after bus pulled up on streets surrounding the Capitol complex and dumped sign-waving protesters clad in purple, green, red and blue shirts that represented a show of strength from a variety of public employee unions and dozens of groups that formed what they named the “Responsible Budget Coalition.”

"Raise my taxes! Raise my taxes! Raise my taxes!" they chanted, lined up shoulder to shoulder for a few hundred yards stretching a street in front of the Capitol.

Springfield Pro-Tax Rally

Save our Schools is a farce. Save our Salaries is what the protest is all about.

The union does not give a damn about the kids.

Click here for a series of 15 Tribune Images of the Pro-Tax Rally.

SEUI Union Thugs

Unions Getting More Aggressive and Obnoxious 

To appreciate just how obnoxious union thugs are in Illinois, please play the above video. I had to play it a few times to make out the key chant from a woman on a megaphone. Here it is.

What do we want?
More money.
What do we want?
We want more money.
When do we want it?
Now?
When do we want it?
Now?

The Ace of Spades blog commented on the rally in "Raise My Taxes! Raise My Taxes! Raise My Taxes!"

So chanted thousands of bused-in ACFSME union "grassroots" agitators to Illinois state congressmen, urging them to "raise [our] taxes!" so that their salaries and benefits wouldn’t be cut.

The rest of the public is finally starting to notice that,


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Rep. Suzie Bassi: “Illinois in Utter Crisis, Next to Bankruptcy, $13bn Hole in a $28bn Budget”; Ambrose Evans Pritchard Inflicted with FIV

Rep. Suzie Bassi: "Illinois in Utter Crisis, Next to Bankruptcy, $13bn Hole in a $28bn Budget"; Ambrose Evans Pritchard Inflicted with FIV

Courtesy of Mish 

French mime artist Marcel Marceau's items auctioned at Drouot in Paris

Ambrose Evans-Pritchard has the right facts but the wrong cure in Don’t go wobbly on us now, Ben Bernanke, an article detailing the problems in many US states, notably Illinois.

Barack Obama’s home state of Illinois is near the point of fiscal disintegration. "The state is in utter crisis," said Representative Suzie Bassi. "We are next to bankruptcy. We have a $13bn hole in a $28bn budget."

The state has been paying bills with unfunded vouchers since October. A fifth of buses have stopped. Libraries, owed $400m (£263m), are closing one day a week. Schools are owed $725m. Unable to pay teachers, they are preparing mass lay-offs. "It’s a catastrophe", said the Schools Superintedent.

In Alexander County, the sheriff’s patrol cars have been repossessed; three-quarters of his officers are laid off; the local prison has refused to take county inmates until debts are paid.

Florida, Arizona, Michigan, New Jersey, Pennsylvania and New York are all facing crises. California has cut teachers salaries by 5pc, and imposed a 5pc levy on pension fees.

This is not to pick on America. Belt-tightening is the oppressive fact of 2010-2012 for half the world. Hungary, Ukraine, the Baltics and the Balkans are already under the knife. Latvia’s economy may contract by 30pc from peak to trough as it carries out an "internal devaluation", ie wage cuts, to hold its euro peg.

The eurozone’s fiscal squeeze is well advanced in Ireland. Brussels has told Greece to cut by 10pc of GDP in three years, Spain by 8pc, Portugal by 6pc. Britain must slash soon, or face a gilts strike.

The Bank for International Settlements says Britain needs a primary surplus of 5.8pc of GDP for a decade to stabilise debt at pre-crisis levels, given the ageing crunch as well. The figure is 6.4pc for Japan, 4.3pc for the US and France. It warns of "unstable dynamics", posh talk for a debt spiral. "Action is needed now."

The West risks a slow grind into debt-deflation unless central banks offset fiscal tightening with monetary stimulus – QE, of course – to keep demand alive. Yet the Fed and the European Central Bank are letting credit contract.

So why has Bernanke broken ranks with King and…
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Governor Christie Declares “New Jersey on Edge of Bankruptcy”

Governor Christie Declares "New Jersey on Edge of Bankruptcy"

Courstesy of Mish

New Jersey is in a state of fiscal emergency. Expect to see more states follow suit. Please consider Christie to freeze $1.6 billion in NJ spending.

Gov. Christie today declared that New Jersey had veered to the edge of bankruptcy and

ordered a broad array of state cuts in an effort to make up a $2.2 billion deficit in the current budget amid falling revenues.

Christie froze aid to more than 500 school districts and public colleges and universities, ordered the end to several state programs and the Office of Public Advocate, and seized unspent money across state government.

"Today, we come to terms with the fact that we cannot spend money on everything we want,” Christie told a special joint session of the legislature. "The days of Alice in Wonderland budgeting in Trenton are over.”

The state’s sales tax revenues are 5.5 percent below projections, corporate business tax receipts are down 8 percent, both below what had been planned under former Gov. Jon Corzine’s administration, Christie said.

Christie also announced the state would not contribute $100 million toward pensions costs and signaled that he would push for massive pension restructuring.

Christie highlighted the benefits for unnamed individual teachers as an example: a retired teacher who contributed $62,000 in total toward her pension who would be expected to receive $1.4 million in pension payments and $215,000 in medical benefits over the rest of her life.

"Is it fair for all of us and our children to have to pay for this excess?” Christie said.

Christie said the state would have to pay $7 billion a year to make up unfunded pension and medical liabilities. ""We don’t have that money. You know it and I know it,” Christie said.

Hello Alice, Wonderland Accounting Is Over

Hello New Jersey, "Wonderland" accounting is over. Hello public teachers and unions, you better be prepared for the results.

Here is a snip of the Text of Governor Christie’s Speech on the State Budget. Please read the snip, but I also encourage you to read the entire speech.

Today, we must make a pact with each other to end this reckless conduct with the people’s government. Today, we come to terms with the fact that we cannot spend money on everything we want. Today,


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Coming Collapse of Municipal Bonds; States, Cities Dig Deeper Holes

Coming Collapse of Municipal Bonds; States, Cities Dig Deeper Holes

Black hole abstract

Courtesy of Mish

In New Jersey, governor-elect Christie opposes (and rightfully so), the state going deeper in debt but that is not stopping the current administration of Jon Corzine.

Please consider N.J. to Borrow $200 Million Amid Incoming Governor’s Opposition.

New Jersey, the third-most indebted U.S. state, will sell more than $200 million in bonds today to finance voter-approved capital projects a week after Governor- elect Christopher Christie said he opposed borrowing more money.

The state will issue $209.1 million of bonds, including $205 million of tax-exempt securities, the largest such competitively bid offering in the market today, according to Bloomberg data. Christie, a Republican who defeated Democratic incumbent Jon Corzine last month, said he opposed new bond sales after the state last week detailed $2.7 billion in borrowing it plans for the remainder of the fiscal year, which ends in June.

The state’s bond sale today will finance clean water and open-space preservation projects, according to a preliminary official statement. The state is also planning to sell $1.4 billion of bonds for transportation and $1.1 billion for school construction before June 30, according to a Nov. 30 report.

Christie, 47, a former U.S. attorney, told Bloomberg News last week that New Jersey “can’t have any more debt” and that any projections for borrowing will be “rendered meaningless” when he takes office on Jan. 19.

New Jersey has $36.5 billion of gross tax-supported debt, the third highest of the 50 states, according to a report released in July by Moody’s Investors Service. Moody’s rates the state’s bonds Aa3, the fourth highest ranking. California has the most, at $75.2 billion.

New York City is leading the municipal market this week as issuers seek to borrow more than $10 billion, according to Bloomberg data. New York, the largest borrower among U.S. cities, is selling $1.4 billion of taxable and tax-exempt securities, including $616 million of Build America Bonds. By yesterday, the city had taken orders from individual investors for $440 million of the tax-exempt bonds, and for $20 million in Build America Bonds that it expects to finish pricing on Dec. 10, according to Ray Orlando, a spokesman for the city Office of Management and Budget.

Yields on conventional 20-year municipal debt fell to an eight-week low of 4.24 percent,


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Phil's Favorites

Who are Sri Lanka's Christians?

 

Who are Sri Lanka's Christians?

Sri Lankan army soldiers secure the area around St. Anthony’s Shrine after a blast in Colombo. AP Photo/ Rohan Karunarathne

Courtesy of Mathew Schmalz, College of the Holy Cross

At least 200 people have been killed in several coordinated bomb attacks on churches and hotels in Sri Lanka on Ea...



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Zero Hedge

Key Events This Week: "Enough To Keep Investors On Their Toes"

Courtesy of ZeroHedge. View original post here.

Despite a slow start to the week, which sees most European markets closed on Monday, there should still be "enough to keep investors on their toes", according to Deutsche Bank's Craig Nicol. First and foremost, earnings season ramps up in the US with over 150 S&P 500 companies reporting including bellwether industrial and tech names in what is set to be the busiest earnings week this season, then Japan's Abe meets President Trump at the White House, UK parliament returns from recess and Russia's Putin meets China's Xi Jinping. We'll also have central bank decisions from the BoJ, Bo...



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Chart School

Weekly Market Recap Apr 21, 2019

Courtesy of Blain.

This past week was the definition of “consolidation” – a period of very little movement and volatility after a large move up to work off overbought conditions.  A slight gap up Tuesday was about it in terms of excitement for the week.  Bulls remain in full control.

We are in the midst of earnings season – it is not a great one but companies have lowered the bar enough that they will “beat”, everyone will clap and cheer, and we continue on.

The first-quarter earnings outlook has improved somewhat, according to CFRA, which said consensus estimates now call for a 2.3% fall in first-quarter operating earnings a share. That is up from the call for a 3% drop ahead of the kickoff of earnings season, but down from the 4.5% increase projected at the end of last year...



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Insider Scoop

Uber To Sell Minority Stake Of Its Autonomous Vehicle Unit To Japanese Consortium

Courtesy of Benzinga.

Uber Technologies is planning to sell a 14 percent stake in its autonomous vehicle unit to existing investor Softbank, Japanese automaker Toyota, and auto parts manufacturer Denso ahead of its much-anticipated initial public offering (IPO), which is expected to happen in May. Though...



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Digital Currencies

5 Cryptocurrency Tax Questions To Ask On April 15th

Courtesy of ZeroHedge. View original post here.

Authored by David Kemmerer via CoinTelegraph.com,

Depending on what country you live in, your cryptocurrency will be subject to different tax rules. The questions below address implications within the United States, but similar issues arise around the world. As always, check with a local tax professional to assess your own particular tax situation.

...



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Kimble Charting Solutions

Silver Bear Market Faces Big Price Support Test!

Courtesy of Chris Kimble.

When silver, gold, and the precious metals industry were red-hot bullish in the 2000’s, investors could do no wrong.

You could buy SILVER at just about any price and it would go higher.

In today’s chart, you can see three large green bullish ascending triangles from the 2000’s that lead to big gains. But that was the bull market before the current bear market.

The tables have turned since the 2011 price top. Silver quickly formed a bearish descending triangle and fell another 50 percent when that broke down. This sent a vicious bear mark...



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ValueWalk

More Examples Of "Typical Tesla "wise-guy scamminess"

By Jacob Wolinsky. Originally published at ValueWalk.

Stanphyl Capital’s letter to investors for the month of March 2019.

rawpixel / Pixabay

Friends and Fellow Investors:

For March 2019 the fund was up approximately 5.5% net of all fees and expenses. By way of comparison, the S&P 500 was up approximately 1.9% while the Russell 2000 was down approximately 2.1%. Year-to-date 2019 the fund is up approximately 12.8% while the S&P 500 is up approximately 13.6% and the ...



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Biotech

Marijuana is a lot more than just THC - a pharmacologist looks at the untapped healing compounds

Reminder: We are available to chat with Members, comments are found below each post.

 

Marijuana is a lot more than just THC - a pharmacologist looks at the untapped healing compounds

Assorted cannabis bud strains. Roxana Gonzalez/Shutterstock.com

Courtesy of James David Adams, University of Southern California

Medical marijuana is legal in 33 states as of November 2018. Yet the federal government still insists marijuana has no legal u...



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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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Mapping The Market

It's Not Capitalism, it's Crony Capitalism

A good start from :

It's Not Capitalism, it's Crony Capitalism

Excerpt:

The threat to America is this: we have abandoned our core philosophy. Our first principle of this nation as a meritocracy, a free-market economy, where competition drives economic decision-making. In its place, we have allowed a malignancy to fester, a virulent pus-filled bastardized form of economics so corrosive in nature, so dangerously pestilent, that it presents an extinction-level threat to America – both the actual nation and the “idea” of America.

This all-encompassing mutant corruption saps men’s souls, crushes opportunities, and destroys economic mobility. Its a Smash & Grab system of ill-gotten re...



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OpTrader

Swing trading portfolio - week of September 11th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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