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Calpers triggers legal fight with bankrupt San Bernardino over pension debt

By bgamall4   Follow   Wed, 28 Nov 2012, 8:43am   1,837 views   38 comments
In Las Vegas NV 89117   Watch (1)   Share   Quote   Permalink   Like   Dislike  

http://finance.yahoo.com/news/exclusive-calpers-triggers-legal-fight-093110813.html I have been saying for some time that this is Calpers versus Wall Street. Will the Federal judge screw with California law and let Wall Street win?

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1. Ceffer Follow Befriend 6 threads 647 comments Pleasanton, CA

   1   4:59pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   It will be a fight among the creditors, secured, unsecured. The best Calpers can hope for is to be first in line amongst unsecured creditors. The situation hasn't been tested because the cities that have gone bankrupt did not want another costly legal entanglement and deferred to Calpers. However, the creditors can sue each other apparently, and that means Wall Street vs. Calpers. I would imagine that ultimately Calpers will lose. Cowardly, pork barrel politicians won't solve the mess, only bankruptcy can cut the Gordian knot of waste and special interests.

2. bgamall4 Follow Befriend (14) 753 threads 2,588 comments 63 male Las Vegas, NV bgamall4's website Premium

   2   5:52pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   Ceffer says I would imagine that ultimately Calpers will lose. Cowardly, pork barrel politicians won't solve the mess, only bankruptcy can cut the Gordian knot of waste and special interests That would be too bad, because California law protects Calpers. Wall Street must not win this.

3. Bap33 Follow Befriend (3) 12 threads 3,098 comments

   3   7:10pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   Oddly, the teacher's version of Calpers just don't get much press.

4. Bellingham Bill Follow Befriend 30 threads 1,488 comments Bellingham, WA Premium

   4   7:48pm Wed 28 Nov 2012   Share   Quote   Permalink   Like (1)   Dislike   CalSTRS is at a 70% funding level: http://www.pionline.com/article/20120409/REG/120409899 with $155B of investments under management. CalPERS has $240B and allegedly is 80% funded. But both of these funding levels are assuming ~7.5% long-run returns. CalPERS's actual return for FY11 was . . . 0.1%. The missing 7.5% of interest income is . . . $18B or so that either has to be made up immediately, or a lot more down the road, since by the rule 72, 7.5% interest doubles the principal in only 10 years . . . I don't know what's going to happen with California's pension issue, but it's a major, major problem coming down the pike. And all the people with spiked pensions and other miscellaneous bullshit is going to create an immense public backlash, too. The Howard Jarvis people called me into a paid focus group not too long ago, and my advice to them was nail the unions on this pension issue, since that's their achilles heel.

5. Ceffer Follow Befriend 6 threads 647 comments Pleasanton, CA

   5   8:00pm Wed 28 Nov 2012   Share   Quote   Permalink   Like (1)   Dislike   California judges have pensions, too. It would seem they have an automatic conflict of interest, which points to the Feds resolving the legal issues above the state level. State laws exist in force where they don't conflict with Federal laws. One would assume that the same legislators that give themselves the store are the ones who constructed the state laws about pensions.

6. bgamall4 Follow Befriend (14) 753 threads 2,588 comments 63 male Las Vegas, NV bgamall4's website Premium

   6   8:09pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   Bellingham Bill says The Howard Jarvis people called me into a paid focus group not too long ago, and my advice to them was nail the unions on this pension issue, since that's their achilles heel. So you are a Wall Street creep? Or what are you?

7. bgamall4 Follow Befriend (14) 753 threads 2,588 comments 63 male Las Vegas, NV bgamall4's website Premium

   7   8:11pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   Melmakian says Thus this part is a complete legal fantasy on Calpers' part: Calpers expressly stated that it was "concerned about inappropriate preferential treatment that might be given to other creditors" in San Bernardino's bankruptcy. Calpers has long argued that pension contributions cannot be touched, even in a bankruptcy. Two laws. One governs pensions and another governs bankruptcy. The pension law should be preserved.

8. Ceffer Follow Befriend 6 threads 647 comments Pleasanton, CA

   8   8:19pm Wed 28 Nov 2012   Share   Quote   Permalink   Like (1)   Dislike   The Rhode Island case does not bode well for Calpers. It is a feast for lawyers, but they should hone their negotiation skills rather than waste more mounds of money in court holding out for vapor.

9. Bellingham Bill Follow Befriend 30 threads 1,488 comments Bellingham, WA Premium

   9   8:23pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   bgamall4 says So you are a Wall Street creep? Or what are you? random "focus group". Paid $100 + a free subway sandwich. Thanks Howard Jarvis! I detest Howard Jarvis organization completely, but everyone has their price. I also think the unfunded liability issue for California is truly stupendously critical. The two pension funds need 5% REAL returns or things are going to get pretty sticky 10-20 years down the road. http://research.stlouisfed.org/fred2/series/WGS30YR

10. Entitlemented Follow Befriend 4 threads 183 comments Goleta, CA

    10   9:11pm Wed 28 Nov 2012   Share   Quote   Permalink   Like (1)   Dislike   As an Engineer who has a few patents and made a bunch of equipment used in part by law enforcement, I am a bit alarmed by the pay of police in Bell California. http://latimesblogs.latimes.com/lanow/2012/08/ousted-bell-police-chief-wants-severance-pay-.html Might also have something to do with my pension is about 1/40th of this dude. Keep on voting for Democrats, Cali............

11. Goran_K Follow Befriend (4) 25 threads 1,520 comments Laguna Beach, CA Premium

    11   9:13pm Wed 28 Nov 2012   Share   Quote   Permalink   Like (1)   Dislike (2)   CalPERs helping put another city into fiscal ruin. No surprise here.

12. Entitlemented Follow Befriend 4 threads 183 comments Goleta, CA

    12   9:22pm Wed 28 Nov 2012   Share   Quote   Permalink   Like (1)   Dislike   Developing a Bell Curve, If we have about 30K Cali Union and Public workers getting over $100K, this is an annual obligation of about $3B per year. This is about 1/4th the Cali Annual Deficit, I recall. Would really be interesting to track back to when Cali was making computers, electronics, Blackbirds, Apollo, and Space Shuttle. The private sector shrivels, and the public sector grows. Democrats are brilliant!

13. Goran_K Follow Befriend (4) 25 threads 1,520 comments Laguna Beach, CA Premium

    13   9:31pm Wed 28 Nov 2012   Share   Quote   Permalink   Like (2)   Dislike   Social engineering never works. Want to see what it eventually creates? Just take a look at Stockton, CA.

14. Bellingham Bill Follow Befriend 30 threads 1,488 comments Bellingham, WA Premium

    14   9:34pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   Entitlemented says Cali was making computers Dude, Apple & Google's market caps are $800B. Entitlemented says The private sector shrivels, and the public sector grows. Democrats are brilliant! California's imbalance is mainly our high cost of housing, which is in fact stripping hundreds of billions out of the paycheck economy into the hands of the 1%. Compared to that structural imbalance the pension BS is miniscule.

15. Bellingham Bill Follow Befriend 30 threads 1,488 comments Bellingham, WA Premium

    15   9:35pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   Goran_K says Just take a look at Stockton, CA. take a look at Stockholm, SE and get back to me on that minarchist bullshit.

16. Entitlemented Follow Befriend 4 threads 183 comments Goleta, CA

    16   9:42pm Wed 28 Nov 2012   Share   Quote   Permalink   Like (2)   Dislike   Take out a calculator. Most of the stuff of Apple is made in China, whos labor costs are lower, and have enterprize low tax zones. Now look back to 1980 when 20% of Californians worked in R&D, manufacturing, and Engineering, of products that could be sold and taxed in California. Now look at Californias 8% current manufacturing and R&D (Counting also that the stuff not all made here). I think that agric is also counted in this? Also, look up where Apple is incorporated. Before you yell, please punch in a few number in your calculator. It not just housing, Dems have lowered rates to keep housing high (for continued payments to CALPERS, and other treats)

17. Goran_K Follow Befriend (4) 25 threads 1,520 comments Laguna Beach, CA Premium

    17   9:58pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   Bellingham Bill says take a look at Stockholm, SE and get back to me on that minarchist bullshit. Yes, their welfare state giving out ridiculous loans to any unqualified buyer nearly cost the country its solvency in 1992. Guess how they got out of that pickle? Oh yeah, reducing welfare, and privatizing public services (including credit). Now they are one of the wealthiest nations in Europe. You want to take your foot out of your mouth now?

18. Bellingham Bill Follow Befriend 30 threads 1,488 comments Bellingham, WA Premium

    18   10:08pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   Entitlemented says Also, look up where Apple is incorporated. The Company is a California corporation established in 1977. Now look back to 1980 when 20% of Californians worked in R&D, manufacturing, and Engineering GMAFB. The 1980s saw the government tear out our defense establishment for the most part. That produced the 1990s LA recession, and LA remained depressed until the housing boom got started there ca. 2002. It is true that mfg has taken it in the pants, falling from 2M in 1990 to 1.2M today, but that's to be expected when China's monthly wage is $200-300. Entitlemented says Dems have lowered rates part of the problem with you conservative posters here is that you've got Dems on the brain. You guys can't think at all about our real problems, you just point the finger at Democrats and blindly blame them without actually detailing the alleged "Democratic" screwup. When in fact a lot of the root causes we face now are actually caused by conservatives and their dysfunctional ideology of greed, and fraud -- disempowering government and then wondering why their sanctified "free market" totally fucks itself up not soon after. "Dems" didn't lower rates, first Greenspan did in the 2001-2004 period (to do what he could to get Bush reelected) and then since 2008 Bernanke has lowered rates because the alternative is simply a cross-default collapse of the economy of debt, an economy of debt CREATED when the Republicans were running the show: http://research.stlouisfed.org/fred2/graph/?g=dez

19. Bellingham Bill Follow Befriend 30 threads 1,488 comments Bellingham, WA Premium

    19   10:11pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   Goran_K says You want to take your foot out of your mouth now? Sweden is still a million times more socialist than us. http://en.wikipedia.org/wiki/File:Tax-Revenues-As-GDP-Percentage Dodge noted, though.

20. Vicente Follow Befriend (8) 203 threads 4,410 comments Davis, CA

    20   10:16pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   Melmakian says Ummm...the US Constitution explicitly gives Congress the right to set bankruptcy law, dude. The Supremacy Clause clearly applies thereby. STATES RIGHTS! Let's Teabag those Federales.

21. Entitlemented Follow Befriend 4 threads 183 comments Goleta, CA

    21   11:00pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   Apple is headquartered in CA, Incorporated in: http://www.nytimes.com/2012/04/29/business/apples-tax-strategy-aims-at-low-tax-states-and-nations.html?pagewanted=all The State of CA chased out much industry in tandem with the decline of defense spending. Dems caused housing to go up with CRA, and the imposition of CRA funding on FHA and private loans. NAFTA was debated, and Ross Perot, the only one with a business background debating was correct. Californias liberal mindset did California in. If high taxes and large government were the way to go, then CA would be flush with money, the State and Cities would be solvent. However, even with the highest amount of taxes, lots of technology, CA is having severe issues. NAFTA did not work, - we cant outsource our way to prosperity. Its taken some time for us to get in this situation, but many cannot even see the cause and the effect.

22. Entitlemented Follow Befriend 4 threads 183 comments Goleta, CA

    22   11:27pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   Clinton alteration of CRA forced much more securitization. Rubins, an treasuring for Clinton and then moved on to CITI, and oversaw an exceleration of CDO by CITI. However, they needed Glass Stegal overturned, and the dems got this done by marching 30 Dems into the leading Republicans office when he did not want to undo Glass Stegal. So the liberals actually did the subprime mess, but the media does not bring this up. The US government meddling in home finance did this. And the Dems altruistic goals for the poor? They fared worse than the middle class............

23. Goran_K Follow Befriend (4) 25 threads 1,520 comments Laguna Beach, CA Premium

    23   11:39pm Wed 28 Nov 2012   Share   Quote   Permalink   Like   Dislike   Bellingham Bill says Sweden is still a million times more socialist than us. http://en.wikipedia.org/wiki/File:Tax-Revenues-As-GDP-Percentage Dodge noted, though. Yeah, you totally got me.

24. bgamall4 Follow Befriend (14) 753 threads 2,588 comments 63 male Las Vegas, NV bgamall4's website Premium

    24   12:17am Thu 29 Nov 2012   Share   Quote   Permalink   Like   Dislike   Goran_K says CalPERs helping put another city into fiscal ruin. No surprise here. Sorry, Wall Street helped a lot of cities into ruin. http://bgamall.hubpages.com/hub/Wall-Street-Bankers-Are-the-Prime-Opposition-to-Public-School-Teachers and http://www.businessinsider.com/cities-be-like-oakland-and-walk-away-from-interest-swap-payments-to-goldman-and-bankers-2012-7 I wrote both. It is all a scam. First, the scam is with charter schools that cherry pick students and are backed by big money to bash teachers' unions and second are the cities who have been helped by Bernanke to reap a windfall from governments, city governments included.

25. bgamall4 Follow Befriend (14) 753 threads 2,588 comments 63 male Las Vegas, NV bgamall4's website Premium

    25   12:18am Thu 29 Nov 2012   Share   Quote   Permalink   Like   Dislike (1)   Goran_K says Social engineering never works True, but then why do you support the greatest social engineer, Wall Street?

26. bgamall4 Follow Befriend (14) 753 threads 2,588 comments 63 male Las Vegas, NV bgamall4's website Premium

    26   12:20am Thu 29 Nov 2012   Share   Quote   Permalink   Like   Dislike   Bellingham Bill says random "focus group". Paid $100 + a free subway sandwich. Thanks Howard Jarvis! I detest Howard Jarvis organization completely, but everyone has their price. I also think the unfunded liability issue for California is truly stupendously critical. The two pension funds need 5% REAL returns or things are going to get pretty sticky 10-20 years down the road. Fair enough. Unfunded liabilities are not helped by Bernanke. Neither are banks with no real interest profits. Neither are investors in bonds. Bernanke needs to throw main street a bone. That could be in the form of just slightly higher interest rates. Otherwise, people take risk and then Wall Street will crash the stock market yet again.

27. bgamall4 Follow Befriend (14) 753 threads 2,588 comments 63 male Las Vegas, NV bgamall4's website Premium

    27   12:27am Thu 29 Nov 2012   Share   Quote   Permalink   Like   Dislike   Entitlemented says Clinton alteration of CRA forced much more securitization. Rubins, an treasuring for Clinton and then moved on to CITI, and oversaw an exceleration of CDO by CITI. However, they needed Glass Stegal overturned, and the dems got this done by marching 30 Dems into the leading Republicans office when he did not want to undo Glass Stegal. So the liberals actually did the subprime mess, but the media does not bring this up. This is all a lie. Read Ritholz, read me. First, Glass-Steagall repeal and derivatives as gambling repeal were sponsored by the Gramms, Phil and Wendy, Republicans. The vote in the senate was along party lines, until the Republicans talked the Dems into going along. The vote was 90 to 8 for Glass-Steagall repeal. Barbara Boxer voted AGAINST repealing Glass-Steagall and you can't get more liberal than that. The CRA was only about 25 percent of subprime. The rest was bogus rated AAA private MBS. The CRA pulled back from origination when securitization took over. The Fed has a chart on it and it is found in my ebook, Ponzi Housing Scheme 21st Century. It is also found online. It is true that Citi got a waiver from Glass-Steagall in 1997. But what you need to know is that the toxic loans came from the UK, where they were called self certified loans. They were imported from the Square Mile, which never had Glass-Steagall like laws. So, it all came from the UK and Basil 2. The risk was mispriced, on purpose, because of a formula given to the central banks by an employee of JP Morgan. It was adopted and applied, circa 2003. Both parties were involved as Geithner allowed the bogus risk CDO's to be spread and Henry Paulson spread them like wildfire in 2004. So that is the story. The public guaranteed pools tried to catch up later, but the real bubble was private.

28. Goran_K Follow Befriend (4) 25 threads 1,520 comments Laguna Beach, CA Premium

    28   11:02am Thu 29 Nov 2012   Share   Quote   Permalink   Like (1)   Dislike   bgamall4 says True, but then why do you support the greatest social engineer, Wall Street? Why do you keep insisting I'm a wall street shill? I simply don't want to fund old-timer retirement funds with my taxes. If anything that makes me a libertarian.

29. Entitlemented Follow Befriend 4 threads 183 comments Goleta, CA

    29   11:22am Thu 29 Nov 2012   Share   Quote   Permalink   Like   Dislike   Moodys view of California Cities http://www.moodys.com/research/Moodys-reviews-ratings-of-32-California-cities-nine-pension-bonds--PR_257248

30. bgamall4 Follow Befriend (14) 753 threads 2,588 comments 63 male Las Vegas, NV bgamall4's website Premium

    30   7:31pm Thu 29 Nov 2012   Share   Quote   Permalink   Like   Dislike   Melmakian says Ah, name calling when you can't make an intelligent counter-argument. Nice. I didn't name call. I asked him. You aren't reading carefully Alf.

31. bgamall4 Follow Befriend (14) 753 threads 2,588 comments 63 male Las Vegas, NV bgamall4's website Premium

    31   7:31pm Thu 29 Nov 2012   Share   Quote   Permalink   Like   Dislike   Melmakian says One is a state law and the other is a federal. The federal one ALSO covers pensions. Why is R-E-A-L-I-T-Y so difficult for you to accept? So you are rooting for Wall Street Alf?

32. bgamall4 Follow Befriend (14) 753 threads 2,588 comments 63 male Las Vegas, NV bgamall4's website Premium

    32   7:33pm Thu 29 Nov 2012   Share   Quote   Permalink   Like   Dislike   Melmakian says Now, all you NON-Californians will be forking over dough to bail out California public workers. Much of California's taxes to the Federal Government goes to Red States. So a little payback would be just fine.

33. bgamall4 Follow Befriend (14) 753 threads 2,588 comments 63 male Las Vegas, NV bgamall4's website Premium

    33   7:34pm Thu 29 Nov 2012   Share   Quote   Permalink   Like   Dislike   Melmakian says Bernanke shouldn't be throwing ANYONE a bone. He should only be limited to maintaining a sound money supply, that's it. The bone is slightly higher interest rates. That would mean less need for QE.

34. bgamall4 Follow Befriend (14) 753 threads 2,588 comments 63 male Las Vegas, NV bgamall4's website Premium

    34   7:35pm Thu 29 Nov 2012   Share   Quote   Permalink   Like   Dislike   Melmakian says How is protecting one's investment and contractual rights constitute 'helping a lot of cities into ruin'. Answer: It doesn't. The idiots who took their funding from Wall Street did themselves in. No, the cities should walk away from the bogus Wall Street scams. And they should stop allowing Wall Street to advise them.

35. taxee Follow Befriend 88 threads 457 comments El Cerrito, CA Premium

    35   2:21am Fri 30 Nov 2012   Share   Quote   Permalink   Like (1)   Dislike

36. taxee Follow Befriend 88 threads 457 comments El Cerrito, CA Premium

    36   2:23am Fri 30 Nov 2012   Share   Quote   Permalink   Like (1)   Dislike

37. bgamall4 Follow Befriend (14) 753 threads 2,588 comments 63 male Las Vegas, NV bgamall4's website Premium

    37   8:34pm Fri 30 Nov 2012   Share   Quote   Permalink   Like   Dislike   Melmakian says Wall Street has NOTHING to do with the cities not bring able to make good on their pension promises. Yes, Wall Street is behind the plan to crowd out Calpers from the protection of state law.

38. bgamall4 Follow Befriend (14) 753 threads 2,588 comments 63 male Las Vegas, NV bgamall4's website Premium

    38   8:36pm Fri 30 Nov 2012   Share   Quote   Permalink   Like   Dislike   Melmakian says No they don't. Not when you factor in the ability of Californians deducting their state income taxes from their federal ones. According to charts, which are admittedly back in 2006 or so, you are incorrect.