There’s been a lot of interest in the series of stories about the changes in health plans for public workers over the past few days. I’m still digging, so stay tuned. And, in the meantime, keep those comments and suggestions coming. All leads are appreciated.
Did you see this news yesterday?
Bloomberg reported that Goldman Sachs advised investors several months ago to buy credit-default swaps to protect against bonds defaults by a number of states perceived to be facing financial problems, including Hawaii.
Credit-default swaps, conceived to protect bondholders against default, pay a buyer face value in exchange for the underlying securities or the cash equivalent should an issuer fail to adhere to debt agreements. They increase in value as perceptions of credit quality deteriorate.
Goldman, which has also served lead underwriter for bonds issued in most of the states, has been criticized for essentially betting against itself and its clients.
As part of a September presentation to institutional investors on “Best Long and Short Risk Strategies,” Goldman recommended buying credit-default swaps on “a basket of liquid State General Obligation credits with current and worsening fiscal outlooks,” including California, Florida, Nevada, Ohio, Wisconsin and Michigan.
The firm also recommended the derivatives on states with “significant unfunded pension” and other retiree obligations, including Illinois, Connecticut, Hawaii, New Jersey, Massachusetts and Nevada.
And speaking of state bonds, I recently noted that while the city routinely posts its official bond statements, the state does not.
But I’ve since learned about the EMMA web site maintained by the Municipal Securities Rulemaking Board, which provides the official statements of municipal bonds, including Hawaii’s. Lot’s of good data to be mined there.
The Los Angeles Times also featured an investigative report on a rental scam in Hawaii. A travel investigation? Seems so. And it’s quite a saga!
Traveling poobahs from the U.S. Deptartment of Education have been letting Hawaii know that they think education is the #1 priority. They’re specifically talking about K-12 education, I guess, since I haven’t heard a peep about higher ed from them.
The latest is an assistant somebody for “communications” (P.R.?) who is quoted in today’s Advertiser:
“We know that states all across America have to cut somewhere,” he said. “We just want to make sure that education is the place that isn’t being cut.”
Now, I’m not unsympathetic to the desire to support education. But it doesn’t make much sense to me to keep classrooms open while cutting the services that so many students’ families rely on. Cut back on support for food, rent, and other basic needs for families in order to keep classroom doors open an extra couple of days a month? If that’s what the Washington folks are pushing, it’s not a tradeoff I could support.
I think this photo was taken Sunday morning. By yesterday, it was cloudy and damp. I’m not sure what to expect this morning. It’s still to dark to tell about the weather right now. Winter is still weeks away, but we’re shivering in temperatures below 70 degrees, nesting under a down comforter at night, etc. Just so folks on the mainland know we’ve got it tough out here.
Oh, yesterday’s photos of an early snow on Mauna Kea reminded me of the network of webcams up there on the mountain that are worth bookmarking for future reference.
Discover more from i L i n d
Subscribe to get the latest posts sent to your email.
Oh, ok, since its you asking, Ian.
I dont think theres a paper trail on this, but there was a legislative hearing 2 years ago, when during questioning, the HMSA lobbyist had her okole handed to her on a silver platter by the House Health Committee Chair. Anyone remember that? I dont remember the bill, but I do remember that the Chair was uber-upset at HMSA. Interestingly, that Chair went on to run and win a Senate seat. Related?
Again, I ask, truly not knowing the answers, what has DCCA been trying to do to reign in the HMSA-beast? Why have those efforts not been successful? Who’s been protecting HMSA and why? Ok, that last one, I do kinda know the answer.
Its pretty clear that the HMA-option is simply going to fail (sorry, Charlie). The trust in this company is just not there – and no amount of forcing it is going to change that. But its also clear, to me, that ‘someones’ are trying to address the HMSA-monopoly/ridiculous amount-of-power-over-our-lives (and Im betting Doctors pocketbooks) issue, and that is something I feel we should all better understand.
Go for it, Ian. And…thank you.
The Bloomberg story ran a year ago — and can be found on Disappeared News in a couple of articles around then, including one on Dec. 25 and another Dec. 31.
What has been difficult is to find an economist or other qualified person to comment on the effect of Goldman Sachs selling Hawaii (and the other states) down the river for its own profit. In other words, have our bonds suffered, or exactly what has been the effect (if any) of this plot against us?
How are credit default swaps even still legal? Why is there still a financial instrument that artificially props up the price of otherwise undesirable paper so if and when they default, the losses are even greater?
The financial industry needs major regulation and frankly massive contraction.
Credit default swaps are still legal because the Bush/Obama bailout essentially put Wall Street back in exactly the business it was in before. Their losses were wiped out, and in the case of Goldman Sachs, their competitor was allowed to go bust (note that the decision makers were ex-Goldman Sachs).
So all we can expect is more of the same.
The article about Amanda the scam artist was very interesting. Thanks!
Thanks for the article on Amanda. Too bad we have so little reporting like that here in Hawaii. I was emailing the reporter and she feels embattled, wondering how long the LA Times will be in business. I was wondering how I could subscribe. My subscription to the Advertiser almost feels like a charitable donation, rather than a subscription, as they have so few good hard looks at anything. Still I pay to save the seals, so I guess I will continue to pay to save the Advertiser and Bulletin reporters but I think I’d gladly pay for the fox in the hen house, as in the good old days of reporting, although mine may be a rare opinion.