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Is Your Credit Union a Part of the Shared Branch Network?How the Big Banks and the Credit Unions Are Handling California's IOUs
POSTED ON BY Ken Tumin
Customers of the big banks in California may have problems after July 10th. That's the cutoff date in which many major banks plan to stop accepting California's IOUs (registered warrants). As described by the California State Controller's Office, the registered warrants are being issued due to the California government being unable to enact budgetary solutions to provide enough cash for the State to pay all of its bills. Assuming there is adequate cash in the Treasury, those warrants may be redeemed on October 2, 2009.
As reported by the LA Times, many big banks including Bank of America, Chase, Wells Fargo and Union Bank have said they'll only cash the state IOUs from customers through July 10. On the other hand, many credit unions plan to continue accepting them as described in this Union-Tribune article.
Mish at Global Economic Trend Analysis has this say about the banks:
He's careful to make the distinction that the issue of accepting these IOUs is different than supporting California's issurance of these IOUs.
Here's a short list of California credit unions that have stated they'll continue to accept the registered warrants. If you know of others, please leave a comment:
Thanks to the reader who emailed me info on this issue.
As reported by the LA Times, many big banks including Bank of America, Chase, Wells Fargo and Union Bank have said they'll only cash the state IOUs from customers through July 10. On the other hand, many credit unions plan to continue accepting them as described in this Union-Tribune article.
Mish at Global Economic Trend Analysis has this say about the banks:
Every one of those blood sucking banks was bailed out by taxpayers (California taxpayers too) and now will not take an IOU from the State of California for the citizens of California. This is disgusting.
He's careful to make the distinction that the issue of accepting these IOUs is different than supporting California's issurance of these IOUs.
Here's a short list of California credit unions that have stated they'll continue to accept the registered warrants. If you know of others, please leave a comment:
- The Golden 1 Credit Union
- LBS Financial Credit Union
- Patelco Credit Union
- Schools First Federal Credit Union (formerly OCTFCU)
- Southland Credit Union
- Star One Credit Union
Thanks to the reader who emailed me info on this issue.
Addison Avenue FCU will also accept beyond July 10th
IOU can not be issued without new source of income for the state.
California is BBB- and close to total junk rating from S&P.
That is the difference that Arnold has to fill year after year with innovative money shuffling to budget the state.
Since, most of the illegals work for cash or under the table, most of the money earned are sent back to their home countries and they plead poverty and qualify for all state handouts. The $20B is a conservative estimate by many experts familiar with the issue.
How the state is going to buy back the already issued IOU, with new issues of IOU? Pathetic financial responsibility, at least to say.
On the issue of illegals draining the state, it is true and ominous.
Until the state come to some senses of fiscal responsibility, this will repeat over and over until the state deal with its handouts once for all.
Wasted billions and billions on illegals year after year is coming back to haunt the state of its ignorance.
Bob
IOU is nothing but a piece of paper that unofficially says:" I'm broke, trust me and I might be able to pay you back or I might give you a new IOU for your old IOU."
Irresponsible state, wasteful budget, no oversight and nobody likes to admit wrong. Shame on all who brought the state to this stage of collapse.
Please read this:
"SACRAMENTO, Calif. -- State vendors and contractors could use their government-issued IOUs to pay state taxes, fees and liens under a bill approved by an Assembly committee.
The Business and Professions Committee unanimously passed the bill by Assemblyman Joel Anderson during its first legislative hearing Tuesday. The bill requires the state to accept its own IOUs as payment for money owed to the government.
Anderson, a Republican from La Mesa, says the measure would help businesses and others being paid with IOUs. The state began issuing the warrants last week as lawmakers struggle to close a $26.3 billion deficit.
The Assembly speakers' office has not decided if the bill needs a second committee hearing before it can be considered by the full Assembly."
Aman
Eventually the Federal Government.
BANKRUPT!
I O U
You can buy stuff or pay with it, just like a real money.
I would like to know what the official exchange rate is.
https://www.nuvisionfederal.org/site/Important_Information.html
http://www.orangecountyscu.org/index.php?/aboutus/news_events/
http://www.ccul.org/general/070809CUsAcceptingCAIOUs.pdf
The legislature is being urged to consider taxing marijuana to help raise revenues.
"One option open to the government of the most populous U.S. state for raising revenue is to tax marijuana"
California Assembly Speaker Karen Bass said Wednesday.
Run for the exits, that is my opinion.
So, what is the difference if they don't pay their obligations or renegotiate the contract or interest rates and or terms and bankruptcy.
If one party can not fulfill the obligation of the contract, is in default. If one party tries to reinsert or modify the contract on the expense of the other is officially insolvent or bankrupt.
Therefore, there is no difference between stop paying obligations, insolvency and bankruptcy. Just a different terminology at different steps of defaults in a signed contracts or obligations.
10:06 AM, July 09, 2009
You don't have to file court papers to be insolvent or bankrupt. Just an announcement from an official or Governor is sufficient to declare such state bankrupt and nullify many obligations and contracts or intentionally defaulting on a obligations for not having means to repay the contracts.
IOU is the last desperate step, not to be declared bankrupt.