It appears that the question of whether the federal government is going to bail out the state of California has been rendered moot. Two large banks have announced that they will accept the IOU's issued from the State of California to its customers beginning today. Wells Fargo announced this afternoon that the bank would be accepting the monopoly money for a period of one week.
Wells Fargo & Company (NYSE:WFC) said today it will accept registered warrants issued by the State of California from its retail and business customers for a limited time. It will begin accepting the registered warrants for deposit on July 2, 2009 and stop accepting them no later than July 10, 2009.
Chase also made a similar announcement:
SAN FRANCISCO (MarketWatch) -- Chase, the banking unit of J.P. Morgan Chase , said Thursday it will accept registered warrants issued by the state of California through July 10. "We will accept the registered warrants from our customers to help them through this challenging time," said Pablo Sanchez, head of Chase's branches in the Western region.
Now that the camel has its nose under the tent who thinks this scheme will be just temporary? The fact that the banks mentioned are TARP banks, beholden to Washington for their very existence, suggests that the U S taxpayer bailout of California has begun.
Permalink | E-mail This | Technorati Links | Sphere: Related Content | Digg this! | FARK It!
Filed under:
Politics
Tags: California Bailout, California IOU's, TARP
Comments (5)
The urge to point and laugh... (Below threshold)1. Posted by Gmac | July 2, 2009 4:03 PM | Score: 1 (1 votes cast)
The urge to point and laugh hysterically is almost to great to resist. Our tax dollars used to bail out the banks are now going to be 'loaned' out to cover CA's fiat money. So, I'm betting that when the chit is called as due CA is going to say "Sorry Sammy, no can do." and guess who is left holding the empty bank bag.
At the very least the person that directed those loans be made should have to answer for them, personally, and not saying "I was just following orders" is going to allow them to skate.
1. Posted by Gmac | July 2, 2009 4:03 PM |
Score: 1 (1 votes cast)
Posted on July 2, 2009 16:03
2. Posted by GarandFan | July 2, 2009 4:41 PM | Score: 0 (0 votes cast)
How long will it take for the California legislature to figure out that it can continue issuing 'warrants' until someone calls them on it? Know what's really funny? If you get an IOU from the state, and you owe them money, you can't send the IOU back to them in payment.
2. Posted by GarandFan | July 2, 2009 4:41 PM |
Score: 0 (0 votes cast)
Posted on July 2, 2009 16:41
3. Posted by hermie | July 2, 2009 4:49 PM | Score: 0 (0 votes cast)
True GarandFan:
There is nothing to back up the IOUs, just a 'promise' to pay. No collateral loans for millions of dollars. The kind of 'risky' lending that got banks in hot water last year.
3. Posted by hermie | July 2, 2009 4:49 PM |
Score: 0 (0 votes cast)
Posted on July 2, 2009 16:49
4. Posted by James H | July 2, 2009 5:29 PM | Score: 0 (0 votes cast)
I'm mildly surprised that the banks aren't offering to buy the warrants at a discount.
4. Posted by James H | July 2, 2009 5:29 PM |
Score: 0 (0 votes cast)
Posted on July 2, 2009 17:29
5. Posted by 914 | July 2, 2009 5:46 PM | Score: 0 (0 votes cast)
As GarandFan says,
If You owe the State cash and send a response back saying "I will pay You back someday when My finances look rosier." Sure they will wait...For about 2 hours before they issue judgements, fines and send the ATF to Your residence. Cause heaven knows, messing with the States our Federal gov's God (money) is a sin worse then murder.
Unless a dictator does it.
5. Posted by 914 | July 2, 2009 5:46 PM |
Score: 0 (0 votes cast)
Posted on July 2, 2009 17:46