A group of the biggest U.S. banks said they would stop accepting California's IOUs on Friday, adding pressure on the state to close its $26.3 billion annual budget gap.... [I]f California continues to issue the IOUs, creditors will be forced to hold on to them until they mature on Oct. 2, or find other banks to honor them. When the IOUs mature, holders will be paid back directly by the state at an annual 3.75% interest rate. Some banks might also work with creditors to come up with an interim solution, such as extending them a line of credit [BWAHAHAHA], said Beth Mills, a California Bankers Association spokeswoman.... The group of banks included Bank of America Corp., Citigroup Inc., Wells Fargo & Co. and J.P. Morgan Chase & Co., among others. The banks had previously committed to accepting state IOUs as payment. California plans to issue more than $3 billion of IOUs in July.
[I]f California continues to issue the IOUs, creditors will be forced to hold on to them until they mature on Oct. 2, or find other banks to honor them. When the IOUs mature, holders will be paid back directly by the state at an annual 3.75% interest rate. Some banks might also work with creditors to come up with an interim solution, such as extending them a line of credit [BWAHAHAHA], said Beth Mills, a California Bankers Association spokeswoman....
The group of banks included Bank of America Corp., Citigroup Inc., Wells Fargo & Co. and J.P. Morgan Chase & Co., among others. The banks had previously committed to accepting state IOUs as payment. California plans to issue more than $3 billion of IOUs in July.
Rall ror rash ris rine. Diversity is the key to economic and political evolution.
[I]f California continues to issue the IOUs, creditors will be forced to hold on to them until they mature on Oct. 2, or find other banks to honor them.
:) In the long run, we're all dead. John Maynard Keynes
Proles do pay state income tax, sales tax...
The problem is every tax has had its revenue earmarked for particular purposes so there's no money in the general fund. A man of words and not of deeds is like a garden full of weeds; a man of deeds and not of words is like a garden full of turds — Anonymous
"Could you sign this petition to make earthquakes illegal? They're really starting to bother me."
Having a state constitution that requires a supermajority to pass a budget is also insane. Even the Senate isn't that fucked up.
And then there is, of course, the property tax regime. Conservatives want live babies so they can raise them to be dead soldiers. - George Carlin
initiatives that only come in two forms: (1) Spend Lots of Money on Cool Stuff and (2) Don't Raise My Taxes.
Instead, they're alienating everyone and likely failing at their fiscal goals. A man of words and not of deeds is like a garden full of weeds; a man of deeds and not of words is like a garden full of turds — Anonymous
Breaking the Money Monopoly would undercut one of their major pillars of dominance.
They're shooting themselves in the foot by doing that because (never mind the big banks) people, by design, can't find a use for those IOUs before maturity. A man of words and not of deeds is like a garden full of weeds; a man of deeds and not of words is like a garden full of turds — Anonymous
IOU recipients are beginning to trade them like currency [sic], forcing the California state treasurer's office to issue guidelines if they are sold through eBay (EBAY), Craigslist or other means. California's treasurer is telling recipients of the IOUs that if they sell them to third parties, they will be redeemed by the state treasurer's office only if accompanied by a notarized bill of sale signed by their listed payee.
California's treasurer is telling recipients of the IOUs that if they sell them to third parties, they will be redeemed by the state treasurer's office only if accompanied by a notarized bill of sale signed by their listed payee.
taxalert.Copythat?taxalert. ht Mish
Speculation is rising over whether California's tax-exempt IOUs, technically registered warrants [as opposed to bill of exchange (indemnity or payment)*?], can be bought, sold and traded. The Securities and Exchange Commission must first determine if the IOUs are securities [certificate of ownership or beneficial interest?] to regulate them, said Ernesto Lanza, general counsel to the Municipal Securities Rulemaking Board, adding that the board was not working directly with the commission on that decision. "It looks like it has all the hallmarks of a security," Lanza told Reuters. "If they are securities, I think they're pretty clearly municipal securities."
The Securities and Exchange Commission must first determine if the IOUs are securities [certificate of ownership or beneficial interest?] to regulate them, said Ernesto Lanza, general counsel to the Municipal Securities Rulemaking Board, adding that the board was not working directly with the commission on that decision.
"It looks like it has all the hallmarks of a security," Lanza told Reuters. "If they are securities, I think they're pretty clearly municipal securities."
------------ *bill of exchange, an ancient American cheque:"Exchange in relation to barter not of goods but of the value of goods, a payment in one place being exchanged for a payment in another place. The popular statement of the theory of exchange represents four principals involved in two transactions. A and B are two persons residing in one place different from the cash from C, so that, assuming the two transactions to be of equal value, one piece of paper satisfies the four parties to these two transactions, and the trouble, expense and risk of sending money from both places are avoided. The piece of paper which performs the service may be a telegraphic order, cheque or bill of exchange." Diversity is the key to economic and political evolution.
You've got to be kidding me. A man of words and not of deeds is like a garden full of weeds; a man of deeds and not of words is like a garden full of turds — Anonymous
