Tuesday, August 21, 2012
Berkshire Hathaway terminated a large wager on the municipal-bond market five years early,
In a quarterly regulatory disclosure filed this month, the Warren Buffett-owned company terminated credit-default swaps insuring $8.25 billion of municipal debt.
The paper said the early termination is deepening questions among some investors about the risks of buying debt issued by cities, states and other public entities.
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This is worrying because Buffet has been on the inside track with Obama and company. What does he know that the financial markets don't know?
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ReplyDeleteWell let us see.... what cities would YOU lend money to today?
ReplyDeleteHere we are in a financial crisis and have been the last 3 years and yet they are updating the schools by redecorating offices, repaving parking lots, new landscaping, building on all the colleges campus in the Los Rios Community College District, giving raises to professors and deans ...... they definitely know something we don't.
Who spends like this when there is so much uncertainty and why?
In their DREAMS - I like how they say it will be profitable from day one of operation. HAHAHAHOHOHOHEHEHEHE
ReplyDeleteThe rail authority claims it can operate the 510-mile system at a cost of about 10 cents per passenger mile, less than one-fourth of the 40 cents to 50 cents it costs high speed rail operators in other countries, the analysis found. If California's bullet train operating costs rise to the international average, losses will range from $2 billion to $9 billion annually, according to the report.
"We are confounded by where the authority is getting its operating costs," Grindley said.
The authors of the study studied both European and Asian high-speed systems. They found that costs range from a low of 34 cents per passenger mile in Italy to 50 cents in Germany and Japan, based on public reports published by those operating systems.
Grindley said it appears that the rail authority's consultant, Parsons Brinckerhoff, estimated the cost of operating the California system by assembling as many as 300 different cost inputs, though the rail authority has declined to identify all of those inputs. In most cases, California's costs would be even higher than those in Europe, including for labor and electricity, Grindley said.
Under a bond measure approved by voters in 2008, the California system is supposed to operate without a subsidy. The authority has repeatedly assured state lawmakers and the public that the system will operate at a profit from the day it begins partial operations. The $68-billion tab for building the system is not included in the operating costs.
The $68-billion tab for building the system is not included in the operating costs.
ReplyDeleteOnly in California does this make sense.
Maybe they can tax the rich to pay for it.
I would move to Texas. More will move to OR and WA
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