Recovery? What Recovery?
by Tom on November 16, 2009
in Market Musings
This quote reminds me of a conversation I had with a friend of mine earlier today. It just so happens that he’s from California. But here was the gist of the conversation:
- Without a substantial “jumpstart,” it’s going to be difficult for the economy to maintain any semblance of the momentum that it currently has.
- The state governments and their budgets are in shambles. Can you imagine seriously revoking statehood as a way to get out of paying bills?
- Without an improving economy, it’s going to be hard for the current administration and majorities in Congress to remain in power.
- So we might very well be looking at some very unusual types of policies and manipulations as everyone tries to position themselves for the 2010 and 2012 elections.
One of the things we both agreed on was that when you allow the government to manipulate elements of the economy, it’s very hard to predict what the unintended consequences might end up being.
We’ll have more on this as time goes on……
Tom Vanderwell
State Finance Directors Warn of More Trouble Ahead – WSJ.com
“I looked as hard as I could at how states could declare bankruptcy,” said Michael Genest, director of the California Department of Finance who is stepping down at the end of the year. “I literally looked at the federal constitution to see if there was a way for states to return to territory status.”
Technorati Tags: State Government, Bankruptcy
