Illinois debt is about to be rated 'junk.' What that means

[Suzanimal]

Illinois is on track to become the first U.S. state to have its credit rating downgraded to "junk" status, which would deepen its multibillion-dollar deficit and cost taxpayers more for years to come.

S&P Global Ratings has warned the agency will likely lower Illinois' creditworthiness to below investment grade if feuding lawmakers fail to agree on a state budget for a third straight year, increasing the amount the state will have to pay to borrow money for things such as building roads or refinancing existing debt.

...


Ratings agencies have been downgrading Illinois' credit rating for years, though they've accelerated the process as the stalemate has dragged on between Republican Gov. Bruce Rauner and the Democrats who control the General Assembly.

The agencies are concerned about Illinois' massive pension debt, as well as a $15 billion backlog of unpaid bills and the drop in revenue that occurred when lawmakers in 2015 allowed a temporary income tax increase to expire.

"In our view, the unrelenting political brinkmanship now poses a threat to the timely payment of the state's core priority payments," S&P stated when it dropped Illinois' rating to one level above junk, which was just after lawmakers adjourned their regular session on May 31 without a deal.

Moody's did the same, stating: "As the regular legislative session elapsed, political barriers to progress appeared to harden, indicating both the severity of the state's challenges and the political difficulty of advocating their solutions."

What is a 'junk' rating?

Think of it as a credit score, but for a state (or city or county) instead of a person.

When Illinois wants to borrow money, it issues bonds. Investors base their decision on whether to buy Illinois bonds on what level of risk they're willing to take, informed greatly by the rating that agencies like Moody's assign.

A junk rating means the state is at a higher risk of repaying its debt. At that point, many mutual funds and individual investors — who make up more than half the buyers in the bond market — won't buy. Those willing to take a chance, such as distressed debt investors, will only do so if they are getting a higher interest rate.

While no other state has been placed at junk, counties and cities such as Chicago, Atlantic City and Detroit have. Detroit saw its rating increased back to investment grade in 2015 as it emerged from bankruptcy — an option that by law, states don't have.

...

http://www.cnbc.com/2017/06/25/illinois-debt-is-about-to-be-rated-junk-what-that-means.html

 

[RJB]

Upcoming false flag?

 

[Voluntarist]

xxxxx

 

[oyarde]

They were withholding lottery winnings until a court order forced them to pay the winners.

There were also failing to send out renewal notices on automobile license and driver license renewals ... then hitting the owners/drivers up for penalty payments if they failed to realize those items were due.

I think about 2012/2013 they raised the cigarette tax by 1 dollar per pack .

 

[Voluntarist]

xxxxx

 

[Suzanimal]

Per http://www.newser.com/story/245010/illinois-budget-mess-means-no-lottery-tickets.html
Powerball officials have informed Illinois that it's no longer permitted to sell Powerball tickets after 28JUN (Wednesday, earlier this week).
Mega Millions officials did the same, informing them that they won't be permitted to sell Mega Millions tickets after 30JUN (Tonight, Friday).
It looks like the lottery companies learned from the earlier episode.
I guess I'll have to drive across the river to St. Louis if I want to pay my tax on people who are bad at math.

Don't bother. It's rigged.

http://www.ronpaulforums.com/showth...nd-Admits-to-Rigging-Jackpots-to-Win-Millions

 

[FSP-Rebel]

 

[tod evans]

The only part of Ill. that might possibly, by some strange quirk, be considered "beautiful" is the flat over-farmed plains section in the middle of the state and that's only when there's been sufficient rain....

The rest of the state is severely overpopulated and in need of a plague.

 

[Suzanimal]

The only parts of Ill. that might possibly, by some strange quirk, be considered "beautiful" is the flat over-farmed plains section in the middle of the state and that's only when there's been sufficient rain....

The rest of the state is severely overpopulated and in need of a plague.

....

Tod Evans wants people to die. It's his fault.

 

[tod evans]

....

 

[Suzanimal]

You must spread some Reputation around before giving it to tod evans again.

 

[Danke]

You must spread some Reputation around before giving it to tod evans again.

 

[Swordsmyth]

[h=1]Illinois Blows Budget Deadline, Pushing It Closer to Junk Rating[/h]https://finance.yahoo.com/news/illinois-blows-budget-deadline-pushing-040100456.html

 

[oyarde]

Too late to save Illinois without drastic measures . I would give Chicago to Canada , remove illinois from statehood and make it a territory and attach a financial head as Governor, fire all legislatures , scrap the public school system ,cut all taxes by half and make the remaining half pay for whatever services remaining that are provided or scrap those services one by one until budget is balanced. Then see if further adjustments are needed a couple years later , probably not .

 

[osan]

http://www.cnbc.com/2017/06/25/illinois-debt-is-about-to-be-rated-junk-what-that-means.html

While a junk-rating would be a truly outstanding development, let us bear in mind the trustworthiness of Moody's, S&P, etc. in light of their shenanigans that lead up to the 2008 bursting of the bubble.

Their lack of credibility aside, such a rating would still be better than the status quo.

I am anxious to get on with this apocalypse thing.