Thursday, December 7, 2017

The union squeeze is on in California

California is at  its downturn. 

Just like  the  last recession, the unions begin using their extra legal powers to extract more money. I see the squeeze in a sudden tightening  of the payment cycle for water and garbage, with increasing penalties.  The county teachers threaten strike over all the corruption in school building, in a declining student population.

I am sure this will be a statewide phenomena, as does Jerry. It is our early signal of the downturn, and it is moving east.

The Vanguard founder says:


The founder of Vanguard Group thinks a conservative portfolio of bonds will only return about 3 percent a year over the next decade, and stocks won’t do much better, with a 4 percent annual gain over a similar period. This is “totally defeating” for pensions, which “are not going to be able to meet their 7.5 percent or 8 percent obligations,” Bogle said in a Bloomberg Radio interview that aired Thursday. “The only return you get on a bond is from the interest coupon,” with fluctuations in prices eventually evening out and becoming relatively negligible over the longer term, he said. Given a portfolio of about half corporate bonds and half U.S. Treasuries, the blended yield is about 3 percent today. “So that’s what you get over the next decade,” he said. “It is almost a given that it will end badly,” he said.

Jerry and the Brownshirts will be hammering the middle class out here. It is going to be a huge mess.

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