NOSTALIGIA FOR THE GOOD OLD DAYS...REMEMBER THESE SONGS THAT CELEBRATED THE CITY?
Posted on 08/13/2018 7:38:43 AM PDT by SeekAndFind
When Chicago issued half a billion dollars in new bonds late last year, some investors balked, though the offering was designed to protect them by guaranteeing that they would be paid with tax revenues that Illinois sends to its biggest city. “It’s an untested model,” the research head at Gurtin, a municipal bond firm, said of the offering—Chicago’s first under a new state law. Ominously, he worried that if Chicago defaults, it was unclear how much protection holders of the new debt would really get.
Even as Chicago grapples with nightmarish violent crime, the city faces imposing fiscal challenges. The city, which says that it will collect about $8.5 billion in local revenues this year, is burdened by an astounding $28 billion in unfunded pension liabilities and another $9 billion or so in money that it owes to general-obligation bondholders, as well as billions more in other debts.
Chicago’s bonds, graded as “junk” by analysts, are among the lowest-rated of any major municipality. That forces the city to stretch the limits of municipal finance, seeking innovative techniques that might get new borrowers on board, but at the potential expense of taxpayers and holders of Chicago’s other debts. It’s becoming increasingly difficult to see how this ends well in the Windy City.
Chicago’s latest fiscal scheme is already making headlines at home and in municipal-finance circles. Late last week, Chicago’s chief financial officer and a financier close to Mayor Rahm Emanuel proposed the idea that the city would borrow $10 billion through a bond offering to shore up its pension system, using a dedicated revenue stream in order to persuade investors to come on board.
(Excerpt) Read more at city-journal.org ...
Their buds at Goldman Sachs will sell them to municipal mutual funds and then sold to unsuspecting buyers.
Why the city pension fund of course. It keeps the scam going for at least another six months. At some point there's going to be a reckoning but the magical accounting schemes will keep it going for as long as possible. At some point the State of Illinois goes under, lets hope there's a Republican majority in the Congress at the time.
They will make Detroit's bankruptcy look like a cake walk, and Meredith Whitney maybe in high demand on the teli if it does occur...
Loaning money to Chicago ... investing for people who wear meat to run with the lions.
Earlier, a muni-bond expert exposed Chicago’s bond financing scheme as a house of cards. An examination of the city’s bond documents uncovered taxpayers paying billions for greedy politicians shady financial legerdemain, including:
<><>(1) using long-term financing to cover day-to-day expenses,
<><>(2) using bond proceeds to pay pension obligations, and,
<><> (3) misappropriating returns from the interest rate swap portfolio (a sub rosa ATM for paying the citys day to day expenses).
The stench from Chicago’s political sleaze is permeating the putrid city hall air... starting w/ Obama’s ex-COS Chi/Mayor Rahm Emanuel. ....and remember, these kingpins of Chicago criminal politics moved into DC with Chicago kingpin Barack Obama.
ANALYSIS Bonding is eternal taxation——the insider deals bonding companies made w/ shady pols to get bonding business would tell a tale of greedy pols accumulating riches through massive govt corruption.If these bonding deals were effectuated by way of referendum at the ballot box——and misled investors into buying tax-fee muni bonds——the SEC would be interested.
EMAIL enforcement@sec.gov
Massive govt corruption might include forgery, falsification of official records, fraudulent state budget entries, tax evasion, illegal wire-transfers, misuse of public office.
Tax-exempt municipal bond investors (including public education bond investors)— have legal grounds to sue if they were deceived about deceptive bond offerings. In many cases, bond issues are approved by voters-—at the ballot box—so that voters may have also been misled WRT uses of fraudulent bond offerings.
Also culpable are:
<><> bonding companies underwriting possible fraudulent bond issues;
<><> banks holding possibly fraudulent bond proceeds;
<><> State/city’s modus operandi in allocating tax-exempt bond proceeds,
<><> the sub rosa acceptance of bond proceeds.
<><> state/city vendors accepting possible fraudulent bond proceeds.
<><> publicly-funded state/city agencies advocating the uses of fraudulent bond proceeds.
The SEC, FBI, banking overight agencies, and the IRS, would be interested in the activities of state/city entities WRT bonding.
EMAIL-—FBI TIPS PAGE https://tips.fbi.gov
EMAIL—enforcement@SEC.gov
Contact the IRS Fraud Unit
EMAIL Banking oversight agencies
Taxpayers should find out which Chicago banks are facilitating this.
<><> Which banks are designated the official repositories of municipal tax dollars.
<><> Which banks are dispensing the ill-gotten proceeds....and to whom.
The idea sounds simple. Chicago could borrow the cash, officials predict, by issuing bonds that pay between 5 percent and 5.5 percent annually. The city’s pension system, meanwhile, projects that it will earn between 7 percent and 7.5 percent annually in the market over the long term. By simple math, earning 7 percent on money that costs you just 5 percent is a winner. “It would be irresponsible for me not to look at it,” Chicago CFO Carole Brown told the press last week.
If you can’t afford it then do without.
Too simple and honest for progressive government.
This seems to fall somewhere between
‘Hope springs eternal’
&
‘Doing the something again, expecting a different outcome.’
Good job Mayor Rahm Emmanuel. What would you expect from a Clinton associate and other "progressives" before him?
Socialists never learn.
Here's some ideas to save Chicago: Renegotiate the pension debt; Offer ONE (1) billion in bonds that are strictly dedicated to increasing police presence to clean up the south side and expand prisons; Give major tax incentives to real estate developers to buy and and re-build the south side ghettoes. Year free of taxes for small businesses in same area; Eliminate or reduce stifling regulations and zoning laws.
Yeah, it's called gentrification. So what? The war zone stops. Your black on black murders decrease and they're off your streets, not to mention the innocent lives saved. Your entire city benefits.
Why is it that a simple uneducated Sailor can see how to operate a business, which is similar to a municipality? Because I owned 3 different businesses after leaving the military and were all profitable.
RE: Put a $15 tax on every Bear, Cub, Bull, Sox and Blackhawk ticket. Tax joggers. Tax bikers. Tax boaters. Tax everything.
Here’s an idea for every city and municipality in the USA -— SCRAP the Pension system and let every single government employee go with a 401K type retirement plan like every other private company employee.
Start with those who are younger than age 45.
I wouldn’t even bother buying a lottery ticket in the state of Illinois.
Imagine choosing the 20 year payout...
“....burdened by an astounding $28 billion in unfunded pension liabilities.....”
Tick, tick BOOM!...................
String up Rahm bone ...
Who is “they?”
Chicago is weighted down by those who fled the South and their descendants. Very little of the Welfare Class is home-grown.
Pensions are a large part of the Machine’s power. Patronage is NOT dead.
Chicago is the Deep State now under attack by Trump. It has been in power for 85+ years.
We wouldn’t have an economy either.
Gold will never be anything more than a beautiful metal again.
Chicago is a beautiful city on the whole.
Cities are where civilization began, the word “citizen” and “civilization” comes from the word for city. They are also the source of new ideas. No major civilization has existed without a big city at its source.
You will note that taking out the big cities is the way to win wars. Why if they are such drains on the taxpayers?
Unfortunately for the troglodytes it is also the economic powerhouse for the whole state and region.
Nonsense. The world functioned on gold for 5000 years.
The US and US dollar are at the peak of our power, and of course, our government, social engineers and bankers are leveraging it to the hilt.
Tell me how their fiat currency is working out for the average citizens of Turkey, Argentina, or China?
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