We sold California short months ago, but perhaps we were a little to hasty. We would have bet the rest of our Hyatt Gold Passport Points that their $4 billion bond sale was doomed after nine months of being shut out of the credit markets all together and being downgraded to the lowest credit rating any state in the Union has to offer. That would have totally ruled out our trip to Lake Tahoe (off peak, you know) because Cali managed to suck in over $6.5 billion instead. We think, however, we know why:
Of the $6.54 billion, California sold $3.2 billion to individual investors.
An effective 9% yield may also have pulled shell shocked Cali denizens out the door (along with the blitz of an advertising campaign).
California Ends Bond Sale [The Wall Street Journal]
Posted by guest , Mar 25, 2009 5:07PM
Why is Cali the new Puerto Rico? New York is the new Yucca Mountain!
Posted by Anal_yst , Mar 25, 2009 5:09PM
Weird, I asked the same (ish) question via twitter the other day. Seems besides living in a soon-to-be (already?) bankrupt State, citizens want to be super-concentrated Cali default risk.
I know I speak for everyone here when I say I am shocked (SHOCKED I tell you!)...
Posted by guest , Mar 25, 2009 5:15PM
If California defaults, could state taxpayers declare there state bond losses against state income tax?
Posted by shalimar , Mar 25, 2009 5:16PM
oh mississipi
http://us.st12.yimg.com/us.st.yimg.com/I/scripophily_2044_67083484
Posted by Anal_yst , Mar 25, 2009 5:28PM
Er I should have clarified with the "not to toot my own horn (seriously)" just that I'm in agreement with EP and whatnot
Posted by guest , Mar 25, 2009 5:32PM
Absurd. A state run ponzi scheme...and from Maxine Waters home state! Who would have thought?
Posted by guest , Mar 25, 2009 5:42PM
Hey #6, it's also Ronald Reagan's home (adopted) state and Richard Nixon's. The left has no monopoly on nutballs and slimebags.
Posted by guest , Mar 25, 2009 6:29PM
Well said, #7.
Posted by guest , Mar 25, 2009 6:32PM
@6 true. But the left is definitely leading the race. (Pelosi, Boxer, Feinstein, Woolsey, Eschoo, Pete Stark, Barbara Lee, Miller - and that's just from the Bay Area!)
And have a little respect for Cali. We're paying 9% - dammit! (For now anyway.)
Man, I can't wait for that high speed rail that nobody is going to use.
Posted by guest , Mar 25, 2009 6:36PM
Oops! @7, then as before.
Posted by guest , Mar 25, 2009 6:50PM
Wow - another ill informed asshatish posting on shitbreaker.com!
Well done!
Posted by guest , Mar 25, 2009 6:59PM
Come on, if we didn't have Uncle Blarney and Maxine those hearing would be more boring than they already are. Fine entertainment at a hearing near you!
Posted by guest , Mar 25, 2009 7:39PM
whine all you want east coast haters! California has staggeringly better weather, is more beautiful at every turn (dont get me wrong, the Meadowlands rock!), has an outdoor/athletic lifestyle you cant even imagine, and oh yeah has zillions of job that pay better than you wall street pukes who are now stopped out at 250 pretax. please, PLEASE, stay on that cold, nasty coast with all the ugly people and if you think about coming out here, just stop off in aspen and vail and stay there.
Posted by guest , Mar 25, 2009 8:29PM
Munis are the new killin' it. Discuss
Posted by guest , Mar 25, 2009 8:30PM
Munis are the new killin' it. Discuss
Posted by Anal_yst , Mar 25, 2009 10:05PM
@13
You sound like one of the Trolls from Curbed.com, home of the infamous "Chicago/LA/SF vs. NYC" fucktard battles.
Please, spare us.
Posted by Lowly Assistant , Mar 25, 2009 11:18PM
Anal,
In fairness, we could use some warm women, cold beer, and 60+ weather. I hate to be a turncoat, but it's around this time each year that I start fantasizing about moving to Florida/California. Although (regarding personality types), Florida=Philadelphia/California=Park Slope. So...yeah, fuck that.
Posted by Anal_yst , Mar 26, 2009 1:21AM
@ Lowly
Oh, no doubt the ideal gig would likely be 2 (lets not get greedy) offices, one in NYC and another in say, Miami, to which one could venture for "fundraising" and "diligence" trips and whatnot. As far as Cali goes, no doubt weather/lifestyle is good, but 3hr time difference and as you said, even more annoying people than NYC (which says alot).
Posted by guest , Mar 26, 2009 5:07AM
California is the canary in the coal mine of the changes Barry O'bama wants to bring.
California has turned its back on good ole' fashioned supply and demand. The rest of us will shortly follow. The complex forces that make up the market cannot be challenged.
Posted by trojan , Mar 26, 2009 6:52AM
Having spent some good years in socal i can say:
1)the beach boys had it right- girls are 10x hotter/easier than in the northeast. i told my buddies in dank northeast colleges they couldn't comprehend the girls in socal vs the dogs barkin at home. better ROI than nyc girls for sure
2)the landscape (minus the central valley) is slightly better than the east (except CT in fall)
3)saying "i work in finance" still makes you the smartest guy in the room
4)i hate the goddamn lakers
Posted by Debter , Mar 26, 2009 10:38AM
uh so the highest yield in the term longest term was 6.10% (6% cpn), that's actually the effective yield.
9.38% is the after tax yield (assuming 35% effective rate).
I know it's nit-picky, but that's how the world looks at it.
Cal isn't going to default.