Chicago Goes Junk, Owes Bondholders $2.2 Billion Immediately

grenade(Zerohedge)  Following an Illinois Supreme Court ruling that struck down a pension reform plan aimed at closing a $100 billion funding gap, Moody’s downgrades Chicago to junk, giving the city the dubious distinction of being the only major city “in recent history” to carry such a low rating other than Detroit. Chicago now faces accelerated payments to creditors of more than $2 billion.

 

 

Chicago2In the end, this serves to underscore not only the pitiable plight of the country’s pension plans (which, by the way, are likely to be far worse off on the whole than meets the eye due to the fact that managers cling to optimistic assumptions about investment returns in order to avoid having to revise the present value of their liabilities sharply higher) but also a worrying trend that we discussed earlier this week — namely, that state and city governments across America are going broke.

~~~~~

This is big, folks.  Because there are at least twenty other state /municipal systems with unfunded liabilities at least as large as those in Chicago.  This bomb has been ticking for over 40 years, and now it is coming due – not just in Chicago, but in the budgetary behavior of every major metro in the US (and Europe, too).  Once the mad rush to the door begins, there will be no stopping it.
Margin calls have a way of cutting across all asset-classes, so the implosion cannot and will not be limited to municipal/state bonds; it will tear right into the heart of the NYSE and Nasdaq…

It will create a tsunami of asset displacement and revaluation, from which nothing will remain untouched.

 

WE HAVE BEEN WARNED

      
Plugin by: PHP Freelancer
This entry was posted in Domestic Enemies, Editorial, Financial, Immigration, Safety and Preparedness, Uncategorized, Voter issues and tagged , , , , , , , . Bookmark the permalink.

6 Responses to Chicago Goes Junk, Owes Bondholders $2.2 Billion Immediately

  1. Phil says:

    Who cares if they are broke, its a city full of criminals and thugs and we all know who came from there.

  2. Rick says:

    Reverend Wright now all them chicken are coming home to roust that right see what I’m telling you.

    • Phil says:

      yup,there all coming home to roost and they deserve it. I have no feelings at all for those people up there, its sad but the shines and the coons control everything and they are still blaming the white man for there troubles. let them all poison themselves, or our rogue government will do it anyway and they are at a faster pace now.

  3. joseph foster says:

    Chicago will go bankrupt, and Obozo will bail them out with federal funds (borrowed of course), just like the banks were bailed out in 2008

  4. LT says:

    I think you guys are missing the point -- I’m saying that Chicago is the first drop of rain from an incoming thunder storm, and that the impact is going to be such that everyone and everywhere will be “getting wet” shortly. It doesn’t matter whether the people of Chicago deserve to receive the punishment for their sins -- we’re all about to suffer for the abuses committed by Chicago, and New York City, and Los Angeles, and etc….

Comments are closed.