2012/04/09

Illinois is Broke

Last Friday’s unemployment data were horrible and as such the market dropped during the scant time it was open during the electronic system (a lot). Although the employment situation is bad and getting worse, don’t expect a politician to be honest about the true situation – especially in Illinois.

Sadly, the follow may be the future for many, if not most, of the country.

The Chicago Tribune reports Surprise! You owe another $54 billion

If Springfield won’t ask six-figure pension beneficiaries to pick up a portion of their health premiums, what are the odds that state legislators will confront their pension monster?

The state of Illinois admits to $83 billion in pension underfunding, a staggering weight on today's and tomorrow's taxpayers. Add to that the as yet uncalculated billions in unfunded pension obligations for city, county and other local governments.

A second, often overlooked time bomb merrily ticking for governments nationwide is the cost of health insurance for all those retirees. That number, too, is hard to gauge, because health care costs — like future investment returns — are unknowable. Yet governments typically don't put aside money for future health care, as they do for future pensions. The culture is to pay-as-you-go.

In Illinois, that means pay-as-you-go-even-more-broke. The Illinois Policy Institute, a right-leaning think tank, now is releasing 133 pages of frightening data. Beyond that $83 billion in unfunded pensions, state government alone faces an unfunded liability of more than $54 billion in retiree health liabilities over the next 30 years.

During the 2011 deliberations, two groups helped block retiree health reform: lawmakers of both parties who have state institutions (and thus state retirees) in their districts, and well-paid lobbyists whose prior careers in government entitle them to, yes, fat public pensions. If that happens this year, we want to read names.

By the last of the IPI's 133 pages, we conjured one question, then a follow-up:

How could Illinois pols do this to taxpayers?

And come November, will voters finally exact some consequences?

Trade well and follow the trend, not the so-called “experts.”

Behold the age of infinite moral hazard! On April 2nd, 2009 CONgress forced FASB to suspend rule 157 in favor of deceitful accounting for the TBTF banksters.

larrylevin@tradingadvantage.com
Trading Advantage
(888) 755-3846

Larry Levin's Trading Advantage is a leading investment education firm that empowers traders to achieve and surpass their financial goals. More than 50,000 students have used Larry Levin's proven techniques for powerful results.

Trading Signals from the Electronic (ES) mini-SP 500

Pivot point sell @ 2:46pm at 1393.75 = +0.50 & b/e (2 lots)

Algorithm positions (3)

“Reading the Tape” positions (4) …combined Secret’s, Algo, & “Reading the Tape” total… -0.25

Click Here to See Yesterday's Detailed Results

Value Areas:

ES 1395.00 / 1390.50
POC... 1392.75
YM 13013 / 12973
NQ 2759.25 / 2742.25

Notes from the Pit

Click here to read

My Links:

See how I became a trader
See Larry's recommended trading computers
View the results of my Day Session Signal Room recent trading signals
Read about my intensive Training Programs

IMPORTANT NOTICE: Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. Nothing in our website shall be deemed a solicitation or an offer to Buy/Sell futures and/or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on our site. Also, the past performance of any trading methodology is not necessarily indicative of future results.

DAYTRADING involves high risks and YOU can LOSE a lot of money. Hypothetical or simulated performance results have certain inherent limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not actually been executed, the results may have under- or over-compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profits or losses similar to those talked about in our site.