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42 sats \ 41 replies \ @TomK OP 29 Jul \ parent \ on: Texas Manufacturing Slump Deepens in July econ
They need to bail out themselves when the labor market cracks
Which state do you think will become bankrupt first?
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California and Illinois seem to be in the most trouble financially.
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California and Illinois.
California has always been troubled financially.
What happened to Illinois? Chicago is there...
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Chicago's a huge mess financially and it's losing population. Many people expected it to go bankrupt during the Great Recession, just like Detroit.
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It's called a "financial death spiral". As their unfunded liabilities come do, they'll have to raise taxes, which will cause more people to move away, further reducing their revenue.
That's exactly what happened to Detroit and several other cities in Michigan. The big difference is that Michigan is better managed at the state level than Illinois, so they were able to get through it.
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I think it's mostly pensions, but also some bond obligations.
Yeah, Detroit's rebounding. It had also been declining since the 60's so it's not likely to get back to where it had been. Eventually, people get through economic downturns. I'm not expecting anywhere to turn into Thunderdome.
First You'll have trouble in the Eurozoe. Hot candidates are Italy and Spain.
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Right, Italy, Spain, Greece always seem to have troubles.
But I dont know if they will be first, maybe a US state might declare bankruptcy.
Maybe California?
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And France, no.2 on the eurozone, is catching up real fast
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Why is it that Switzerland always seems to never go bankrupt?
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Switzerland is doing everything it can to remain an attractive location for capital. to this day, they defend a relatively stable banking secrecy, they have their own currency, they rely on direct democracy and a free market economy wherever possible: all in all, they are a veritable capital heaven compared to the European Union that surrounds them.
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I see.
Is their banking really secret anymore?
I know for a fact the US government has snooped a few times.
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basically, hardly any banking secrecy protects itself from the americans. it was mainly about keeping the europeans at bay. But slowly but surely this front is also eroding. But Switzerland is still a preferred location for capital, because things are getting much worse in the eurozone
basically, hardly any banking secrecy protects itself from the americans. it was mainly about keeping the europeans at bay. But slowly but surely this front is also eroding. But Switzerland is still a preferred location for capital, because things are getting much worse in the eurozone