From Mark Lawrence:
The Postal Service is set to default for the first time ever, failing to make a $5.5 billion retiree health fund payment due August 1. Another payment worth about $5 billion is due in September. The mail will continue to get through, for now, but if this was an actual company lawsuits would be flying fast and furious and talk would be of bankruptcy.
Ron Paul's bill to audit the Fed now has more than half the house's members as co-sponsors, rather strongly indicating it will pass a house vote. Far less likely is that it will pass the Senate. After the election? We'll see. . .
San Bernardino, the southern CA city that just declared bankruptcy in part due to falling property taxes, is exploring a novel idea: use eminent domain to seize distressed properties. There are two clear paths for this: seize properties where no payments have been made for a long time, then condemn them or resell them at a much lower price. The other idea would be to seize properties where the owners are current on their payments, pay off the mortgage at current prices forcing a large loss on the lenders, get a new mortgage based on the current price, then sell it back to the owner at the lower price with the lower mortgage payment. San Bernardino is favoring the second approach, giving help to the people who have played by the rules; banks of course favor the first approach, take their problems off their hands. San Bernardino houses have lost almost 60% of their value in the last four years.
What is consciousness? Rocks don't have any, and therefore live strictly in the "now." A pair of asteroids about to collide have no sense of impending doom; asteroids colliding have no sense of surprise; after the collision they have no sense of pain or disappointment or change or anything being different. It takes consciousness - emotion plus memory - to give a sense of time to the universe: the ideas of past, present, future; the ability to learn from the past or to project into the future. Stockton Mayor Ann Johnston said that when she voted for the expensive pension increases that helped put her city into bankruptcy, "We didn't have projections into the future what the costs might be - I learned that you don't make decisions without looking into the future." Said Mr. Deis, the Stockton city manager, "Nobody gave thought to how it was eventually going to be paid for." So we see that Stockton city officials aren't actually conscious creatures and could have been replaced with a bunch of rocks with little difference. I doubt there is anything unusual or atypical about Stockton politicians or bureaucrats in this regard.
Next on the list to declare bankruptcy? It looks to be Compton, a city buried in south central LA. Compton's bonds are already rated as junk. But it's likely they'll survive the month of August, so perhaps another city will overtake them. Also very close is Victorville and Montebello. In Victorville not only is a bankruptcy looming, but some city officials may be facing jail time - the SEC is investigating them for fraud.
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