Or!
Posted on 06/04/2019 7:22:22 AM PDT by SeekAndFind
The California Legislative Analyst Office warned that a crash in Silicon Valley stock crash could threaten state solvency with $12 billion in annual capital gains tax losses.
The nonpartisan Legislative Analyst's Office (LAO) has provided the California Legislature with fiscal analyses and budget advice for 75 years to ensure the “executive branch is implementing legislative policy in a cost efficient and effective manner.”
According to the LAO, California personal income tax (PIT) collections are the “single largest source of General Fund revenue.” Key to those collections are capital gains taxes associated with Silicon Valley stock gains. With the tech stock saturated NASDAQ Index up + 371.08 percent since 2009, California’s annual capital gains tax collection skyrocketed by +800 percent from about $2.1 billion in 2010 to $16 billion in 2018.
With California’s total budget spending for state employee wages and benefits at about $10 billion a year, the LAO warned in January that PIT collections for Fiscal Year 2018-2019 ending in June 30, were trending down by almost $2.7 billion, with mostly due to a 22 percent fourth quarter tank in the NASDAQ market index. Fortunately for state bureaucrats, Silicon Valley stocks spiked to an all-time-record high on April 29th, and the State of California was back on track to meeting its projected budget revenues.
Concerned by the continuing China Trade War and escalating antitrust actions against Google, Apple, Facebook, and Amazon ending the Silicon Valley stock market boom, investor selling caused the NASDAQ Index to wipe out all its recent gains and plunge to a -2.84 percent loss for the last 12 months.
Worried about an even bigger budget deficit, the LAO issued a report titled ‘How Uncertain Are Capital Gains Revenue Estimates?’.
(Excerpt) Read more at americanthinker.com ...
...a crash in Silicon Valley stock crash ...
I think this article was written by the department of redundancy department.
Gosh.
Let’s worry about California, not China.
Blah, blah, blah.
They are scared about Google-FB Anti Trust.
And they should be!
Apple and MS have managed to be left wing political without crossing the Anti-Trust line.
Apple isn’t a Monopoly and MS doesn’t use their company for political power.
Gates uses his Foundation.
Yea its a fine line but a wise CEO pays LOTS of attention to the fine line.
Gov. Newsom isn’t worried. He’s offering free medical care for all illegal aliens…which means millions of people.
If ever a state deserved to go belly up, it’s California.
Concerned by the continuing China Trade War and escalating antitrust actions against Google, Apple, Facebook, and Amazon ending the Silicon Valley stock market boom, investor selling caused the NASDAQ Index to wipe out all its recent gains and plunge to a -2.84 percent loss for the last 12 months.
...
Never mind the Federal Reserve causing a recession with their inverted yield curve. The Fed has a decades long history of causing recessions.
Or!
RE: Never mind the Federal Reserve causing a recession with their inverted yield curve
And that just happened recently.
You determine wealth not by how much money is coming in, but by how much is going out.
California politicians over the years have put some spending requirement into the state constitution. Which means they have little control over their spending.
Add to that the politicians are owned by the public employee unions. The unions provide financial support and votes while the politician provide good pay and retirement. So that is out of their control.
The only thing they can control is TAXES (and fees) but the truth is, there is only so much they can tax before the people revolt.
So the State of California is bringing in billions but they are also paying billions, they are like a family that is living pay check to pay check with no savings. A stop or even a slowing of funds coming in could be a disaster.
A disaster of their own making.
The state has made a lot of unwise commitments and locked many of those commitments into the Constitution or Union agreements.
The courts will not help as they will force the state to honor their contracts. California, meet ROCK and a HARD PLACE.
California is the canary in the coal mine for our nation. Sadly, it is the biggest canary in the country and when it inevitably implodes (and it will), we will all be hurt by it.
No they haven’t.
Read Byte and PC Magazine from the mid eighties through the late nineties.
Bill Gates bought the right judges, regulatory bureaucrats, and politicians.
What a joke.
Legislative Analyst's Office (LAO)
They forgot the "M"
Do California tax payers get to deduct capital losses from their state taxes?
Fixed
The obvious Rat solution: RAISE TAXES!!
Goodbye Prop 13.
Silicon Valley Leftist Thugs AND California Democrats feeling pain?
The WINNING just never stops!
California is the canary in the coal mine for our nation. Sadly, it is the biggest canary in the country and when it inevitably implodes (and it will), we will all be hurt by it.
Making predictions is usually a fools errand but I will make one anyone.
When California implodes, and taxes begin going up, the rich liberals will be some of the first to abandoned California.
Silicon Valley can exist anywhere. Same with Hollywood.
It will not be a sudden or open departure but more of slow motion transfer out of state.
California will be all for a wall, only this wall would be to keep people from leaving /s
If Donald Trump loses the election next year, the stock market will collapse, taking California’s tech sector with it; yet no one is doing more to destroy Donald Trump’s re-election chances than California’s tech billionaires who are flooding Democratic coffers with campaign funds.
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