As a California-based business, we offer the following commentary and wonder, “Why are we still here?”
Yes, it’s warm in California but we’re talking about a different kind of melting. On June 10, 2009, California Controller John Chiang had this to say about the Golden State’s economic future. “Without immediate solutions from the governor and legislature, we are less than 50 days away from a meltdown of state government.”
This could get ugly, folks. Unlike the federal government, California doesn’t have the option of printing its own fiat currency to postpone doomsday.
(Insert random Terminator joke here.)
The big problem is there simply is not enough coming in over the transom from tax receipts to even begin straightening things up. Want to hear some real numbers? There has been a 39% drop in personal income tax receipts since last year. Add to that a 52% drop in corporate tax receipts and an 8% drop in sales tax receipts. These are some serious numbers. Forget balancing the budget. They can’t keep Arnie in stogies with that level of fiscal hemorrhaging.
What do you do? Leave the state seems to be the unanimous decision among many. One thing is for sure – we track and recommend income properties for investing in almost 40 local markets around the country. California will NOT be going on our good list any time soon.
The Platinum Team
