My Thoughts On Chicago’s Financial Crisis

I know I’ve been blogging a lot about Chicago/Cook County/Illinois lately. Which should come as no surprise to regular Survival And Prosperity readers considering I’ve talked about how I was born on the West Side, was raised around that area, and lived on the Northwest Side until I moved to the northwest suburbs two years ago.

Both the Chicagoland area and Illinois have been on my mind a lot recently. I fear we’re on the verge of some major upheaval stemming from decades of fiscal mismanagement by policymakers from both sides of the political aisle (some might think this blog only targets Democrats- over the years I’ve demonstrated everyone’s “fair game”). And by verge, I mean in the coming weeks. Focusing on Chicago today, what might kick it off (regular observers have witnessed the crisis growing for some time now)? I suspect the following. From the Chicago Tribune website back on July 31:

At a news conference this week, the mayor would not rule out a politically unpopular property tax hike, saying he’ll wait to show his hand until September, when he rolls out “a full budget with all parts in there.”

(Editor’s note: Bold added for emphasis)

A good portion of the coming pain is going to be felt by the Chicago taxpayer. What kind of “pain” am I talking about? That which I’ve been blogging about for a couple of years now- new/higher fees, fines, and taxes, coupled with reduced government services. Last night’s post about potential revenue generators Chicago Mayor Rahm Emanuel and the City Council are mulling over (hat tip Fran Spielman of the Chicago Sun-Times) should give Chicagoans a better picture of what’s headed their way (a property tax hike and garbage collection fee look likely). Concerning cutbacks in government services, I think that’s already begun. For example, the manpower shortage in the Chicago Police Department (hat tip Second City Cop) that’s existed for some years now. Down the road, I predict the average Chicago taxpayer will find it increasingly difficult to afford living in the city, let alone doing it safely as local government struggles to provide effective, efficient services to constituents.

Now, it’s bad enough Chicago/Cook County/Illinois are in real financial trouble. But then there’s the legitimate concern of a slowing economy/recession being right around the corner, never mind that coming financial crash I started blogging about back on Memorial Day Weekend 2007.

So what’s a Chicago taxpayer to do? This former Chicago resident picked up and left the city limits in 2013. Concerned about future tax and public safety liabilities, my girlfriend and I reluctantly departed our “suburb in the city” and moved into a house in a not-too-far away authentic suburb. Granted, we’ll still be on the hook for county and state problems, but it’s what makes sense for us in the short-term.

As much as I blast Chicago on Survival And Prosperity (“tough love”), I’m not convinced the city’s going to go “belly-up.” I think there’s a good chance it could be run by something similar to the Emergency Financial Control Board in New York City from 1975 until 1986 (talked about here back in April), but even a setback like that won’t be the end of the “City By The Lake,” just like it wasn’t for the “Big Apple.” I do predict city life is going to get real hairy once the “balloon goes up,” but I think that will be the case in a lot of urban areas nationwide.

That’s my two cents on Chicago’s financial crisis- for now. Chicago readers of this blog- what are you planning to do about the crisis? Or, what are you already doing? Maybe you don’t think a crisis exists? Please share your thoughts or experiences in the “Comments” section of this post, as I’d really like to talk more about this going forward.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s note: I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein)

Source:

Dardick, Hal. “Emanuel needs $754M more to make ends meet.” Chicago Tribune. 31 July 2015. (http://www.chicagotribune.com/news/local/politics/ct-rahm-emanuel-chicago-budget-shortfall-met-0801-20150731-story.html). 21 Aug. 2015.

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Chicago Taxpayers To Be Hit With Property Tax Hike, Garbage Collection Fee?

Chicagoans- think all the recent talk of new/higher fees, fines, and taxes is garbage?

You’re right, in a way.

I just finished reading some material from Chicago Sun-Times City Hall reporter Fran Spielman over on that paper’s website.

Chicago taxpayers had better be prepared for their pocketbooks to take a hit in the coming months.

Spielman talked Sunday afternoon about the City’s need for $754 million in new revenue, and the options submitted by City Council to Mayor Rahm Emanuel to help “generate” it. That included:

• Property tax hike
• Garbage collection fee
• Ride-hailing companies (Uber) surcharge
• Congestion fee
• Bicycle license
• Gas tax hike
• Sales tax hike
• City income tax

Which ones stand a good chance of being put into play by City Hall? Spielman wrote:

Ald. Carrie Austin, outspoken chairman of the City Council’s Budget Committee, put Emanuel on the spot during the mayoral campaign when she called a post-election property tax hike inevitable. But she was right — especially now that a Circuit Court judge has overturned Emanuel’s plan to save two of four city employee pension funds.

The only question is, how much will property taxes be going up?

Emanuel has already offered to raise property taxes by $225 million for the Chicago Public Schools, provided teachers accept the equivalent of a 7 percent pay cut and the state reimburses CPS for “normal” pension costs…

(Editor’s note: Bold added for emphasis)

In a separate Sun-Times piece from last night, Spielman added:

Ald. Pat O’Connor (40th), Emanuel’s City Council floor leader, said it’s no longer an issue of whether Chicago will have a garbage-collection fee. The question is, how much?

“That’s where the real discussion will take place. It will be around the cost, rather than the enablement. We need to see the numbers that show how much we’ll save and how much it would generate,” he said…

(Editor’s note: Bold added for emphasis)

Property tax hike. Check. Garbage collection fee. Check.

Waiting to see what actually transpires. In the mean time, Chicago taxpayers might want to check out those Spielman articles to get a better idea of what might be in store for them shortly.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Sources:

Spielman, Fran. “Property tax hike, garbage fee, congestion tax all on the table.” Chicago Sun-Times. 16 Aug. 2015. (http://chicago.suntimes.com/news/7/71/876236/chicago-budget-revenue-tax-ideas). 20 Aug. 2015.

Spielman, Fran. “Chicago homeowners likely to pay for garbage pickup soon.” Chicago Sun-Times. 19 Aug. 2015. (http://chicago.suntimes.com/news/7/71/891070/garbage-collection-fee-looks-likely-chicago-homeowners). 20 Aug. 2015.

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Survey: Illinois Runner-Up State For ‘Worst Climates For Small Business’

Continuing Tuesday’s discussion about Illinois not being business friendly, I spotted a piece last night on the MarketWatch website entitled, “The best state and city for small business are…” Caitlin Huston reported yesterday afternoon:

The best state for small business owners is Texas and the worst is Rhode Island, according to an annual survey revealed Tuesday.

The survey, conducted by technology marketplace Thumbtack, contends that the friendliest states and towns for small businesses offer easier or non-existent licensing requirements. On a city basis, the report called Manchester, N.H., the best and Hartford, Conn., the worst for small-business climate…

Huston noted that survey responses came from 17,633 small businesses, with most having 5 or fewer employees.

As for Illinois? It’s the state runner-up under the “Worst Climates for Small Business” category, losing out to Rhode Island but ahead of Connecticut, California, and New York, in that order.

From the Thumbtack.com survey web page:

Small business owners gave California, Connecticut, Illinois, and Rhode Island an “F,” while Massachusetts, Maryland, and New York earned a “D” grade…

(Editor’s note: Bold added for emphasis)

Digging deeper into the Thumbtack.com Small Business Friendliness Survey, the “Land of Lincoln” received an “F” for “ease of starting a business” and “overall friendliness.”

Nice. Real nice. Congratulations Illinois policymakers (not Rauner’s fault)- local and at the state level- on a “job” well done.

Then again, what would one expect from folks (not all of them, to be fair) who have never started/run a business in their lives?

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Source:

Huston, Caitlin. “The best state and city for small business are…” MarketWatch. 18 Aug. 2015. (http://www.marketwatch.com/story/the-best-state-and-city-for-small-business-are-2015-08-18). 19 Aug. 2015.

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Wednesday, August 19th, 2015 Business, Government, Main Street No Comments

Exit Of Illinois Businesses Picking Up Steam?

Illinois companies are leaving the state for more business-friendly environments.

A tale I come across on a regular basis these days, despite all the sustained propaganda to the contrary.

Marissa Bailey reported on the CBS 2 (Chicago) website Monday regarding the situation of Chicago-based Hoist Liftruck, which just announced they’re departing for Indiana:

Gov. Rauner ran his campaign on what he could do to keep small businesses in Illinois. On Monday, he was begging small businesses to stay in the state.

CBS 2’s Marissa Bailey talked with a business owner who is leaving Illinois for a better deal.

Its 300 employees — most in a trade – work hard in a warehouse the size of two city blocks. But it’s the company’s home for only a few more months.

“I think if anyone looks at the numbers, they would make the same decision I did,” President and CEO Marty Flaska says.

He’s moving his company to East Chicago, Ind. early next year. Flaska says being a manufacturer in Illinois just got too hard. His biggest reasons involve the worker’s compensation system here, the cost of property taxes and lastly, he says, “the uncertainty about income tax in the state and where it may go.”

Flaska estimates that by moving he can save $6 million upfront and $2 million each additional year, thanks to property incentives, state grants and tax cuts in Indiana…

(Editor’s note: Bold added for emphasis)


“Chicago Business Bailing On Illinois”
CBS 2 Video

On the heels of that Hoist Liftruck announcement, Bob Adelmann added over at The New American magazine website:

On Thursday, Hoist Liftruck’s announcement that it was moving more than 500 manufacturing jobs to Indiana was just the latest in a long and almost fevered list of other companies seeking to escape Illinois’ outrageous workers compensation costs and high taxes.

On July 14 machine-maker DE-STA-CO said it was moving 100 jobs to Tennessee. The next day energy processor Bunge North America said it was shutting down its plant in Bradley, Illinois, and laying off 210 workers. The day after that General Mills pulled the plug on its manufacturing plant in West Chicago, terminating 500 workers.

A week later Mitsubishi Motors announced it was closing its production facilities that made its Outlander, ending 918 jobs there, even though there was the threat it would have to return some of the $9 million Illinois paid to get them to move there a few years ago.

Five days after that Mondelez (makers of Oreos and Chips Ahoy) said it was laying off 600 manufacturing jobs at its Chicago South Side facilities.

On August 12 Kraft Heinz, within weeks of their merger, announced its goal of saving $1.5 billion by the end of 2017. First to go were 700 jobs at Kraft’s Northfield facility. The very next day Motorola Mobility announced it was cutting its workforce in Chicago by 25 percent, eliminating another 500 jobs…

Adelmann also noted:

Chief Executive Magazine’s “2014 Best and Worst States for Business” report ranked Illinois 48th out of 50…

I dug up the most recent edition of that same report. The results of Chief Executive’s 11th annual survey have Illinois ranked again as the 48th “worst state for business” in 2015, following New York and absolute “worst state” California.

California, New York, and Illinois. What could those three possibly have in common that might account for such low marks?

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Sources:

Bailey, Marissa. “For One Chicago Business, Illinois Became Too Inhospitable.” CBS 2. 17 Aug. 2015. (http://chicago.cbslocal.com/2015/08/17/for-one-chicago-business-illinois-became-too-inhospitable/). 18 Aug. 2015.

Adelmann, Bob. “Trickle of Companies Leaving Illinois Turning Into a Flood.” The New American. 14 Aug. 2015. (http://www.thenewamerican.com/economy/sectors/item/21405-trickle-of-companies-leaving-illinois-turning-into-a-flood). 18 Aug. 2015.

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Tuesday, August 18th, 2015 Business, Government, Income, Taxes No Comments

Quote For The Week

“You have to be a crazy guy and a little eccentric to be very successful.”

-Tadashi Yanai (Retailer and richest man in Japan with estimated worth of $22.7 billion. 1949- )

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Tuesday, August 18th, 2015 Business, Quote For The Week No Comments

NW Indiana Self Reliance And Preparedness Expo In Schererville On August 29

I thought some Chicago-area prepper show was going on at the end of August. And when I headed over to the Prepper Shows USA website earlier today, I spotted this:

2015 NW Indiana Prepares

Banquets at St. George
Schererville, Indiana
August 29-August 29

FREE to attend!

A variety of preparedness and sustainable living vendors and educational presentations are planned. There will be skill building opportunities, exhibits and food available for purchase

Time 9:00 AM to 4:00 PM…

I headed over to the web page listed for more information (belongs to Live Free, USA, billed as “one of the oldest and most respected survival/self-reliance advocacy organizations in the world”) and saw the following:

2015 NW Indiana Prepares!
Self Reliance and Preparedness Expo
Fun and informative for the whole family!

Alternative Energy Exhibits, Hands On Projects, Food Storage & Preservation Workshops, Raising Poultry & Small Game Forum, Home Defense Presentations, Herbal Health Alternatives, Aquaponics, and More!

FREE ADMISSION & PARKING

Head on over to that event web page here more information, including a schedule of events and a description of presentations/vendors.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Project Prepper, Part 36: New Gear For Around The Property

Getting back on track with the “Project Prepper” series of posts, I want to talk about some new gear I’ve picked up. As a somewhat-new homeowner, I understand there will be times when I’m forced to investigate God-knows-what around the property, day or night. And as my girlfriend and I have come to discover, we have quite the wildlife refuge going on outside our house. As such, I’ve acquired some items in case an encounter with a four-legged (or two-legged) creature isn’t exactly a “pleasant” one:

Outdoor Security Final

Maglite S6D015 6-D Cell Flashlight (Amazon.com, $24.88)

Some specs compiled from Amazon.com:

• 163 lumen Krypton 6-cell bulb
• 19.5 x 2.9 x 2.8 inches
• 2.8 pounds
• Machined aluminum
• Self-cleaning rotary switch, 3 position, On, Off and Signal (manual momentary on-off)
• Spare lamp safely secured in tailcap
• O-ring sealed for water resistance
• 1/2 turn, cam action focus, spot-to-flood

A favorite among old school cops/security guards. After popping 6 D cell batteries into the flashlight and wielding it for the first time, I now understand why. This 19.5-inch machined aluminum device is a beast, and bright to boot. No creature (two- or four-legged) in their right mind would want to mess with this thing.

I also picked up an accessory pack (Amazon.com, $8.68) for the flashlight, and have already affixed the terrific anti-roll device.

Tact Gear Tactical Vest (Sportsman’s Guide, $26.99 with member discount)

From the Sportsman’s Guide website:

16 pockets for mags, radios, flashlights, pepper spray and more.
Rugged 8 1/2-oz. 60/40 Poly / Cotton blend with DuPont™ Teflon® fabric protection
Concealed crossover backup gun pocket with VELCRO® brand closure
Brass zip front
Brass D-ring
Badge tab.

I don’t know if it’s possible to ever run out of pockets with this vest. I’ve treated it with water repellant and have it hanging in a coat closet for fast, easy access. The last two items are contained in the vest.

Mace Brand Pepper Spray Police Strength 10% Pepper Foam (Amazon.com, $14.19)

From Amazon.com:

• Compact yet powerful model is a convenient size for carrying.
• Flip Top Safety Cap
• 10% Foam Spray
• Contains UV Dye for marking assailants for easy identification

I bought a two-pack of Mace Pepper Foam some time ago for potential use indoors (supposed to reduce chance of area contamination). This is one of those canisters. Since the device may have to be deployed in close quarters, I’m sticking with the pepper foam outdoors for now.

Enlan Bee M024A Folding Knife (Ebay, $10.61)

From vendor hellogiftshop’s web page:

Producer: Enlan Cutlery Co.,Ltd
Model: M024A
Blade: 8Cr13MoV (58HRC) stainless steel
Handle: Aluminium+ Stainless Steel; Money clip
Size:
Whole length: ~170mm(6.7″);
Blade’s length: ~71mm(2.8″);
Closed Length: ~100mm(3.94″)
Liner Lock
Net Weight: ~99g

I was on the look out for a good-yet-inexpensive knockaround folding knife that wasn’t “scary” for these parts to keep in the vest. I’d heard decent things about Enlan Cutlery out of China, and came across model M024A (drop point, dual thumb studs, liner lock, realistic-looking wood grain, legal in municipality/Cook County/Illinois) for a measly $10 and change. Like every other piece of gear I talked about in this post, I still have to put my Enlan knife to the test. However, my first impressions of the folder are positive. I would have preferred to buy American here, but was unable to tick all the required boxes.

More next time…

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s note: Items added to “Gear And Supplies” page)

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More On Riots

Yesterday’s talk about riots reminded me of a post I published on Survival And Prosperity back on September 14, 2012. I blogged:

Speaking of urban riots, I recently came across an interesting read on the Western Rifle Shooters Association blog. Matt Bracken, an ex-Navy SEAL of Enemies Foreign and Domestic trilogy-fame, wrote about a vision of the future where an economic crisis leads to widespread, large-scale urban unrest in the United States. As the situation deteriorates, Bracken asks what would happen if food benefits via the national Electronic Benefit Transfer (EBT) system are suddenly cut off? What he pictures happening is disturbing to say the least.

You can read “Bracken: When The Music Stops – How America’s Cities May Explode In Violence” on the Western Rifle Shooters Association blog here.

Just don’t read it before you go to bed…

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Wednesday, August 12th, 2015 Civil Strife, Crime, Food, Preparedness, Self-Defense No Comments

Chicago Averages 1,492 More Property Crimes In Summer Months Than Any Other Month Of The Year

I happened to catch the following from Elana Dure in my Sunday paper the other week. She wrote in the Chicago Tribune on August 2:

Summer vacations may be fun, but they can also be costly if you aren’t careful about leaving your home protected.

In Chicago, June, July, and August have an average of 1,492 more property crimes than any other month of the year, according to a Chicago Tribune crime report.

People are more active during the summer, and houses stand empty more frequently, making them greater targets for burglars…

(Editor’s note: Bold added for emphasis)

Considering The Old Farmer’s Almanac is predicting above-average warmth for the area in September and October, I wonder if there also won’t be an uptick in property crimes for those months as Chicagoans are out enjoying themselves as much as they can after two years in a row with long, miserable winters.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Wednesday, August 12th, 2015 Crime, Security, Weather No Comments

The Survival Podcast’s Jack Spirko On Nationwide Riots

If you’ve been following the news the last couple of days, you’re probably aware of the renewed tension in Ferguson, Missouri, on the first anniversary of the riot there. Back when I started this blog in 2010, I suspected civil strife would pick up due to worsening financial conditions and other developments.

Regrettably, I think Ferguson is just the tip of the iceberg.

I’m not the only one who sees more civil disturbance on the way. Modern survivalist and host of The Survival Podcast Jack Spirko has been issuing warnings as of late. And I’ve been listening attentively. Back on May 20 I blogged:

Speaking of The Survival Podcast, I was listening to a different episode (number 1566, “What the Baltimore Riots Say about our Future”) some time back and took note of some advice host Jack Spirko shared with listeners. He warned on April 28:

You know those trendy areas in downtown that everybody thinks are great places to live as a hipster, because you can walk to the donut shop and the coffee shop? Sooner or later in most of our big cities those are going to be burned to the ground. Don’t live there. Don’t live there. One more time, don’t live there. Get out of the urbanized areas. I don’t care how you do it, just do it. You’re better off anyway…

Spirko added later in the podcast:

I wish I had better news for you. I wish I could tell you that this is an isolated incident. But here’s what I believe. The potential for this type of a riot exists in every major city in America. And it actually would be relatively easy to set them off like fires. It really would. I think the right people, with the right messaging, the right agitation, the right insiders, could cause a riot like this in any city with a population over 500,000 in America today. And quite a few smaller venues too. I really do. That should scare the shit out of you. But the response should scare you even more. It’s not going to be pretty. That’s why you need to be prepared…

Spriko wasn’t about to leave listeners “hanging” on this topic, so on July 29 he released episode 1614, “The Danger Of Nationwide Riots.” From that show:

So here’s what I think you need to do for your own protection. Number one, you need to be at some level of in touch with your local law enforcement. Sheriff’s department, local PD, whatever. You need people that will tell you what they know if things are starting to go sideways. And they will know when they start to go sideways long before a TV says so. You need to be paying attention to chatter with a police scanner or a scanner app or something like that in your general community on an ongoing basis. Just once in a while. Couple times a day just checking in to see what’s going on. Some local PDs have like online now where you can go online and see all the police activity…

The closer you live to a city, the more you need to have a plan to eventually say, “As much as I want to stay and defend my home, it’s not worth it, I’m leaving.” And I know the survivalist mentality is strong in our community. And I will stay here, I will pick up my guns, I will do no harm to anybody, but if you come here and take what I have, I will lay you flat out. I know that is in you, because it’s in me. I mean, that’s how I feel. And in many instances, it’s the course I would take. You can do whatever you want until you mess with me or my neighbors and then it’s on bitches. But you have to think about the result. If your home’s burnt to the ground, that’s what insurance is for… And I would rather rebuild my life with fire insurance, than I would want to try to rebuild my life from behind the bars of a penitentiary, which is a place you may end up if you take that stance. There may come a time when you have to, where you have no choice… I mean what you need is a neighborhood banded together. You’ve seen the signs after hurricanes and stuff- 20, 30 friggin’ rednecks with guns. “You loot, we shoot.” Usually that is enough to defer and cause avoidance. But the closer you live, the less likely that is to be. So the closer you are in, the more you need to have a plan to bug out, which you should have anyway because hurricanes, tornadoes, fires, they are also reasons you might have to bug out. Illnesses, pandemic… There’s times getting out of the way make sense.

You also have to have a good, solid bug-in plan. The bug-in plan is the most important plan you need for this. For most of us, we do not live in the streets where these types of things actually happen. The spillover into suburbs, etcetera will be limited. And it will be more like one-off type things. It will not be wholescale rioting. The safest course of action for most people is going to be for a month or more to hunker down, live off of what you have, go out as little as possible, coordinate with your neighbors, coordinate with what’s left of local law enforcement, and wait this thing out if it happens. It’s going to be the most sane, rational thing that you can do. It going to be the only way no matter how good your intentions are you’re not going to be part of one of the groups pouring gasoline on the fire. So the bug-in plan is important, which means all your basic preps- food, water, energy, medical, health, etcetera. It means if you live in a city that is particularly vulnerable to this and you work where they will be a problem, or you’d have to cross the problem to get to work, this is the time now to start talking to your boss about and say, “Hey look, if something did go sideways in this town, don’t you think it would make sense if we had ways for our people to work remotely, so that the company’s operations can continue, but nobody’s life had to be at risk.”

You need to be tied in to your neighbors. You need to have agreements with your neighbors… There’s some neighbors you really can’t go deep with them about this, but you just need to know them. What’s their name? What’s their spouse’s name? When do they work? When do they come home? What are they like? So when this stuff starts to go sideways, instead of telling them it may go sideways, it’s going sideways right now, let’s work together to protect our neighborhood. You need to be part of your neighborhood, part of your community. Whether it’s a rural one or an urban dense one, doesn’t matter. You need to know as many people’s names as possible.

You need to be trained in self-defense and you need to be armed. In spite of what I said about the fact that you could get into a situation where if you defend yourself you could be prosecuted, there’s a point at which that goes out the window. When you legitimately feel that your life or the life of a loved one is being threatened, and lethal force is the only alternative, the time to use it is two-and-a-half seconds ago. But you can’t go back two-and-a-half seconds so the time is now…

But overall what you need is a plan… I don’t know anything about you individually, okay? So in the end, you have to say to yourself, “Self, this is something that could happen. If it did, near me, what would we do, and when would we act.” In other words, when would we say, “Okay, nobody is going to school or work.” What would be the level of danger that we would have a clearly-defined border, and once that occurred, how long could we be okay? How long would we be alright?… If we did leave where would we go? What would be our basic rules of engagement? When would we act? Who would I contact first in the neighborhood? What would I say? You just need to mentally run the scenario in your head. Not to the point where you start to fear from it or have apprehension from it. Just to the point where if it does occur, it’s not like, “Holy shit, what do I do now?” like you’ve never thought about it before. See, that’s the big thing I want to leave you with today… What matters is that you’ve mentally drilled into yourself that there’s something I can do and these are the things that I would do. That’s what makes you able to adapt and survive.

Whew. Wise words from Spirko on dealing with a disturbing event that I predict Americans will be experiencing more frequently in the coming years.

You can listen to episode 1614 in its entirety here, and episode 1566 here, on the The Survival Podcast website.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Chicago Public Schools Budget: Property Taxes Hiked To The Max

“Property tax hikes.” Something Chicagoans better get used to hearing in the coming years. Hal Dardick, Heather Gillers, and Juan Perez, Jr., reported on the Chicago Tribune website last night:

Chicago Public Schools unveiled a budget Monday meant to pressure Gov. Bruce Rauner and state lawmakers into providing nearly a half-billion dollars in pension relief, a gambit school officials warn will bring painful cuts if help doesn’t arrive by Jan. 1.

In addition to help from the state, the $5.7 billion operating budget relies on extensive borrowing, an influx of tens of millions in dollars in surpluses from special city taxing districts and an increase of the district’s property tax

To help patch over a budget gap the district said exceeds $1.1 billion, CPS will raise its property taxes to the maximum amount allowable — resulting in a $19 tax bill bump for the owner of a $250,000 home, the district said — while pushing $200 million in debt into the future…

(Editor’s note: Bold added for emphasis)

$19 here, a few bucks there, and pretty soon all these “bumps” start to add up, leading to mass frustration among Chicago taxpayers. And’s this particular increase isn’t a one-off either. From the Tribune piece:

And if Springfield does comes through — which is far from a sure thing — [Chicago schools chief Forrest] Claypool said the district would still need concessions from unions and larger tax hikes in years to come to keep up with the cost of ballooning pension payments…

(Editor’s note: Bold added for emphasis)

Like I said, “mass frustration.”

At what point does it all boil over?

Chicago taxpayers should probably read this article in its entirety to get a clearer picture of what looks to be in store for their pocketbooks in the near future and farther down the road. You can find the piece on the Tribune website here.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Chicago-Area Expressway Shootings Jump

I thought there was an uptick in the number of local expressway shootings lately. Frank Main reported on the Chicago Sun-Times website yesterday:

Expressway shootings have become a major problem. They not only threaten the lives of motorists, but they have also caused frequent traffic jams as police shut down the expressways to investigate them.

In 2010, there were six shootings on Chicago-area expressways.

Last year, there were 18.

And so far this year, there have been 25

In the past two years, one person was killed and 23 people were wounded in the shootings, according to the Illinois State Police.

Most of the shootings don’t appear to stem from road rage, said Sgt. Clare Pfotenhauer, a spokeswoman for the state police. Usually, they involve gang conflicts, she said.

A law enforcement source said gang members follow their targets onto the Dan Ryan and Eisenhower expressways because they believe it’s easier to get away from police on the expressways than on neighborhood streets…

(Editor’s note: Bold added for emphasis)

I’ve logged a lot of hours on the Eisenhower over the years. Back in the late nineties, I was heading east on I-290 into the city when I noticed my girlfriend at the time was staring out the front passenger window at other vehicles. Just then what appeared to be a car full of gangbangers pulled up alongside of us. By the look on their faces, they weren’t too happy being stared at by some far west suburban white girl. Nothing came of the incident. However, living off the West Side at this time, I knew better than to stare at other vehicles and their occupants on certain stretches of Chicagoland roadway lest they consider “popping a cap in my ass” (a couple of years earlier while driving on I-43 in downtown Milwaukee I already had a handgun flashed at me), and gladly shared such concerns with this young lady later that day.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Source:

Main, Frank. “As Chicago expressway shootings soar, state police crack down.” Chicago Sun-Times. 9 Aug. 2015. (http://chicago.suntimes.com/lynn-sweet-politics/7/71/864981/trumps-blood-feud-deviants-think-hes-wrong). 10 Aug. 2015.

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Monday, August 10th, 2015 Crime, Public Safety, Transportation, Vehicles No Comments

Jeremy Grantham: Stock Market ‘Ripe For Major Decline’ In 2016

Jeremy Grantham, the British-born investment strategist and founder/former chairman of Grantham, Mayo, Van Otterloo & Co. (oversees $117 billion in client assets as of June 30, 2015), is the last “crash prophet” I’ll be talking about this weekend. Regular readers of this blog know Grantham, whose individual clients have included current Secretary of State John Kerry and former Vice President Dick Cheney, has warned for a year now that he believes bubble territory for the S&P 500 is about 2,250 (Friday it closed at 2,078).

However, Grantham has now offered up a potential timeframe for a “major decline” in equities.

Robin Wigglesworth reported on the Financial Times (UK) website Thursday:

A well-known fund manager who foresaw the Japanese crash, the dotcom bubble and the global financial crisis has predicted that markets will be “ripe for a major decline” some time in 2016, potentially triggering government bankruptcies.

Jeremy Grantham , founder and chief investment strategist of GMO, a $118bn investment house based in Boston, expects the stock market to continue to march higher in the coming year, eventually sucking in retail investors and setting up a serious decline around the time of the US elections in late 2016.

The famously bearish and often prescient money manager said this could trigger a “very different” type of crisis, because many governments had become considerably more indebted and much of the liabilities had shifted to the balance sheets of central banks.

Given that central banks were able to create money to recapitalise themselves, this “could be a crisis we could weather”, Mr Grantham said. “If not, then we’re talking the 1930s, where you have a chain-link of government defaults.”

(Editor’s note: Bold added for emphasis)

A disturbing piece by Wigglesworth, which you can read in its entirety on FT.com here.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s notes: Info added to “Crash Prophets” page; I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein)

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Peter Schiff: Sell Dollars, Buy Gold, Gold Stocks, Chinese Stocks

The second “crash prophet” I’ll be blogging about this weekend is Peter Schiff, the CEO and chief global strategist of Euro Pacific Capital. Schiff, who correctly called the housing bust and 2008 economic crisis, appeared on CNBC Asia last Wednesday and shared the following with viewers:

The dollar has had a huge rally based on the anticipation of a normalization of interest rates, of a shrinking of the Fed’s $4.5 trillion balance sheet. All this is wrong. None of this is going to happen. It’s all fantasy. That balance sheet is going to explode when they launch QE 4. So the dollar is a bubble. You should sell dollars. Gold has been suppressed because people have been buying dollars and selling gold. Gold’s a great buy. Gold stocks. And you’ve had a nice correction I think in your part of the world, in Hong Kong. Some of these Chinese shares, I think there’s a lot of opportunities there to look to protect yourself in the equity markets. Because when the Fed unleashes QE 4, that’s going to send a lot of money into the emerging markets. A lot of money is going to leave the U.S. in search of safe havens.


“The Last Thing That Fed Wants is a Rate Hike”
YouTube Video

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s notes: Info added to “Crash Prophets” page; I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein)

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Must-Read Marc Faber Interview

Regular readers of Survival And Prosperity know on Sundays I try and blog about the latest investment activities/recommendations of the “crash prophets”- Marc Faber, Jeremy Grantham, Jim Rogers, and Peter Schiff. This week, three of the “prophets” are sounding off. First up is Marc Faber. An interview of the Swiss-born investment advisor/money manager was published Friday on the website of MarcoPolis, a Paris-based international online publishing company. Johnnes Maierhofer and Peter Matay conducted one of the most comprehensive interviews of Dr. Faber I’ve ever come across, writing on MarcoPolis.net:

In this exclusive interview with Marcopolis.net Marc Faber covers it all: from commodities and China to the outlook on inflation, the Euro and gold. According to him the global economy is not healing. To the contrary, we might find ourselves back into recession within six months or a year. In that case he expects more money printing by central banks, which eventually could lead to high inflation rates and renewed strength in commodity prices.

On the bright side, he sees great economic potential in Vietnam. Also, the Iraqi stock market has good potential now that a deal with Iran has been reached. While mining stocks are extremely depressed we might see defaults before any meaningful recovery…

Followers of Faber know he’s been a gold bull for years now. The publisher of the monthly investment newsletter The Gloom Boom & Doom Report said this about the precious metal (and other investments of his) during the exchange:

I own gold and it doesn’t worry me that it went down because as I mentioned to you I have this diversification, the bonds in US dollars and the cash in US dollars has been a good investment essentially over the last twelve months. Then I own equities and I own properties in Asia that have been reasonably good investments so the fact that gold is going down doesn’t worry me and I buy every month a little bit but I think on this weakness I will increase the position substantially because I had maybe say 25% in gold but because equities and properties went up, the dollar went up and gold went down, the allocation to gold is no longer 25% but maybe only 10 or 15%.

So then I have to stock it up again. But I would say an individual should definitely own some physical gold…

“Doctor Doom” believes gold confiscation is a possibility, and added later in the discussion:

I think they will take the gold away and go back to some gold standard by revaluing the gold say from now 1000 dollars an oz. to say 10,000 dollars an oz…

A “must-read” interview for Faber followers, which you can access in its entirety on MarcoPolis.net here.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s notes: Info added to “Crash Prophets” page; I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein)

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