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SEC Destroys California
The Market Ticker ^ | 7.10.09 | Karl Denninger

Posted on 07/10/2009 7:37:39 AM PDT by rvoitier

Well now they've gone and done it:

"The staff of the SEC has expressed its belief that California's recently issued IOUs are 'securities' under federal securities law. As such, holders of these IOUs and those who may purchase them are protected by the provisions of the federal securities laws that prohibit fraud in the purchase or sale of securities," the agency said.

That was a mistake.

Here's why.

(Excerpt) Read more at market-ticker.denninger.net ...


TOPICS: Business/Economy; Government; US: California
KEYWORDS: ca2009; iou; sec
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1 posted on 07/10/2009 7:37:39 AM PDT by rvoitier
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To: rvoitier

The SEC did not destroy California. California committed suicide.


2 posted on 07/10/2009 7:40:14 AM PDT by P-Marlowe (LPFOKETT GAHCOEEP-w/o*)
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To: rvoitier

It is not at all difficult to see why this is happening.

The ELECTORAL VOTES of Taxifornia are critical to the Socialist Party.


3 posted on 07/10/2009 7:40:33 AM PDT by EagleUSA (if)
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To: rvoitier

California was destroyed by liberals far before the SEC.


4 posted on 07/10/2009 7:40:48 AM PDT by DCBryan1 ( Arm Pilots&Teachers. Build the Wall. Export Illegals. Profile Muslims. Execute child molesters RFN!)
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To: rvoitier
No The Democrats destroyed California by pandering to illegal aliens.

Deport them all now

5 posted on 07/10/2009 7:41:19 AM PDT by troy McClure
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To: rvoitier
If a state owes you a tax refund and does not pay it, can you withhold any future tax payments up to the amount that is owed plus interest...and penalties?
6 posted on 07/10/2009 7:42:00 AM PDT by Dr.Syn
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To: rvoitier; Grampa Dave

Ping...


7 posted on 07/10/2009 7:42:14 AM PDT by tubebender (I just discovered where all my lost tag lines went...)
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To: rvoitier
California's new state bird.

8 posted on 07/10/2009 7:45:16 AM PDT by TSgt (Extreme vitriol and rancorous replies served daily. - Mike W USAF)
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To: P-Marlowe

Without getting into the unnecessary “they did it to themselves” argument I really did wonder about these CA IOU’s.

If they were issued as 90 day type bearer bond notes with 3.75% interest how were they NOT subject to SEC regulation?


9 posted on 07/10/2009 7:47:11 AM PDT by PittsburghAfterDark
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To: rvoitier

I saw some previews on TV. I was excited to see it, it was a 1/2 hour program deal and I’d never seen Borat.

This Bruno stuff was boring. I stopped watching after about 5 minutes.


10 posted on 07/10/2009 7:49:30 AM PDT by Woebama (Paying for my neighbor's mortgage and Wall Street's bonuses sure is hard.)
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To: troy McClure
No The Democrats destroyed California by pandering to illegal aliens.

Deport them all now

Then let's get started doing something about the illegal aliens...

11 posted on 07/10/2009 7:57:24 AM PDT by Onelifetogive (See www.buyingapuppy.com for News on Dogs and Puppies)
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To: rvoitier
...if you try to sell these "securities" for immediate cash.

CA has declared that selling their IOUs requires notarization of approved transfer from the original payee - practically prohibiting selling these "securities" for immediate cash.

The Soviet Union's last straw was inability to pay obligations. These IOUs are effectively non-transferrable low-interest high-risk securities - an obfuscated way of saying CA isn't paying obligations.

12 posted on 07/10/2009 8:03:35 AM PDT by ctdonath2 (John Galt was exiled.)
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To: Onelifetogive

They won’t cower and submit.
They’ll rally for Aztlan.
Ya ready to take on 10,000,000 CA residents declaring state independence?


13 posted on 07/10/2009 8:05:04 AM PDT by ctdonath2 (John Galt was exiled.)
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To: rvoitier
Now all that remains is for Treasurerury or the Fed to open a facility to back the securities. Presto, chango, allakazham, you have solved the crisis. We are witnessing the birth of a new currency.
14 posted on 07/10/2009 8:06:01 AM PDT by FreedomNotSafety
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To: Dr.Syn
If a state owes you a tax refund and does not pay it, can you withhold any future tax payments up to the amount that is owed plus interest...and penalties?

Maybe not interest and penalties, but possibly the principal. The Federal Govenment allows taxpayers to offset refunds against future payments of estimated tax. If a state, like California, allows such offsets, then that would be a good way to collect an unpaid refund.

15 posted on 07/10/2009 8:06:17 AM PDT by libstripper
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To: rvoitier

Another reason why Texas must undertake its right under Union entry and secede from the mess that is now the USA


16 posted on 07/10/2009 8:09:50 AM PDT by bestintxas
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To: rvoitier

The man is quite correct.


17 posted on 07/10/2009 8:10:36 AM PDT by Lurker (The avalanche has begun. The pebbles no longer have a vote.)
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To: rvoitier
Now all that remains is for Treasurerury or the Fed to open a facility to back the securities. Presto, chango, allakazham, you have solved the crisis. We are witnessing the birth of a new currency.
18 posted on 07/10/2009 8:20:55 AM PDT by FreedomNotSafety
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To: Dr.Syn

Yes.


19 posted on 07/10/2009 8:23:19 AM PDT by Grampa Dave (Does Zer0 have any friends, who are not criminals, foreign/domestic terrorists, or tax cheats?)
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To: FreedomNotSafety
We are witnessing the birth of a new currency.

Yeah, never mind that pesky Constitution.

I shudder to think what consequences all this Alinskyite destruction will bring.

20 posted on 07/10/2009 8:23:25 AM PDT by TChris (There is no freedom without the possibility of failure.)
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