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Californiqa *is* bankrupt. It’s just the financial part of the equation hasn’t gotten there, yet.

There are some interesting human nature aspects to bankruptcy.

1) We woke up one morning and USSR was bankrupt. It happened that fast. I was in Mongolia and state farms were stripped. I do remember looking down and the only asset not taken was the manure chain still loaded with manure. It happened so fast the manure chain was not run for the last time.

2) Nothing changes until the cash flow stops. What causes that change? I worked with farmers and it was life as usual until the banker said no.

3) AT the point of bk there is a mad dash for assets. Some legal, some not so much. Almost like musical chairs, who is going to be with out a chair. Again the state run farms were stripped.

4) If the original bankruptee was still left in business, nothing changed, they were right back to their poor management decisions. New creditors eager to lend to a business that couldn’t go through bankruptcy for another 7 years. (in theory)

5) The right new management and outsiders helped the process. FDIC brought in the mean old retired bankers who understood banks to take over the defunct banks. The faster things happened, the better.

There are more bits of wisdom, but enough for now. Bottom line, there are no rules for state bankruptcy and we don’t want rules. Let nature take it’s course, it is brutal but then the healing begins.........................