Financial News

[southsider2k5]

The State of Illinois has cost itself $80 million because of its fiscal reputation over the last five years.

 

http://www.nwitimes.com/news/local/illinoi...ddec468ee1.html

[Jenksismyhero]

The State of Illinois has cost itself $80 million because of its fiscal reputation over the last five years.

 

http://www.nwitimes.com/news/local/illinoi...ddec468ee1.html

 

Governor's office has been filled by a Democrat since 2003. Generally Assembly has been controlled by the Democrats since 2003. And you say we've spent more than we could afford? Say it ain't so!

[Cknolls]

Governor's office has been filled by a Democrat since 2003. Generally Assembly has been controlled by the Democrats since 2003. And you say we've spent more than we could afford? Say it ain't so!

 

 

And Madigan wants the State to pitch in $100 million for the library of Narcissus....

[NorthSideSox72]

I had to post this somewhere...

 

So, New Jersey's Governor Christie passed an Administrative Action (no need for the legislature) that effectively bans all direct car dealerships. Cars MUST be sold by third parties. This move effects exactly one company - Tesla, who will have to close it's two dealerships in the state as a result.

 

Leaving aside the amazing hypocrisy here, of Christie's touting of free markets and then doing the opposite and stifling competition... and leaving aside how awful it is for the government of a state to target a specific business this way to make other businesses happy, turning the state into a tool for businesses driving out competition... this, to me, is a great example of how the corporate money invading politics actually results in business-stupid policy.

 

Here's the kicker... there are two other states that have passed similar laws or actions - Texas and Arizona. Funny thing, Tesla is right now looking to build it's new Giga battery factory, with seven thousand jobs at the beginning and more later, as well as a possible new vehicle plant nearby with thousands more jobs. There are four states in the running - Texas, Arizona, Nevada and New Mexico.

 

This is called shooting yourself in the foot. Congratulations, TX and AZ (and NJ). Your "leaders" are lining their warchests with lobbying money, while costing jobs and tax revenue that would actually help people in your states.

 

[Y2HH]

I had to post this somewhere...

 

So, New Jersey's Governor Christie passed an Administrative Action (no need for the legislature) that effectively bans all direct car dealerships. Cars MUST be sold by third parties. This move effects exactly one company - Tesla, who will have to close it's two dealerships in the state as a result.

 

Leaving aside the amazing hypocrisy here, of Christie's touting of free markets and then doing the opposite and stifling competition... and leaving aside how awful it is for the government of a state to target a specific business this way to make other businesses happy, turning the state into a tool for businesses driving out competition... this, to me, is a great example of how the corporate money invading politics actually results in business-stupid policy.

 

Here's the kicker... there are two other states that have passed similar laws or actions - Texas and Arizona. Funny thing, Tesla is right now looking to build it's new Giga battery factory, with seven thousand jobs at the beginning and more later, as well as a possible new vehicle plant nearby with thousands more jobs. There are four states in the running - Texas, Arizona, Nevada and New Mexico.

 

This is called shooting yourself in the foot. Congratulations, TX and AZ (and NJ). Your "leaders" are lining their warchests with lobbying money, while costing jobs and tax revenue that would actually help people in your states.

 

So the more that things change, the more they stay the same?

[ptatc]

I had to post this somewhere...

 

So, New Jersey's Governor Christie passed an Administrative Action (no need for the legislature) that effectively bans all direct car dealerships. Cars MUST be sold by third parties. This move effects exactly one company - Tesla, who will have to close it's two dealerships in the state as a result.

 

Leaving aside the amazing hypocrisy here, of Christie's touting of free markets and then doing the opposite and stifling competition... and leaving aside how awful it is for the government of a state to target a specific business this way to make other businesses happy, turning the state into a tool for businesses driving out competition... this, to me, is a great example of how the corporate money invading politics actually results in business-stupid policy.

 

Here's the kicker... there are two other states that have passed similar laws or actions - Texas and Arizona. Funny thing, Tesla is right now looking to build it's new Giga battery factory, with seven thousand jobs at the beginning and more later, as well as a possible new vehicle plant nearby with thousands more jobs. There are four states in the running - Texas, Arizona, Nevada and New Mexico.

 

This is called shooting yourself in the foot. Congratulations, TX and AZ (and NJ). Your "leaders" are lining their warchests with lobbying money, while costing jobs and tax revenue that would actually help people in your states.

If the incentives are right, they could still build the cars in that state but sell them elsewhere. It doesn't really shoot them in the foot. A co-worker bought one of the first Teslas. He put money down on it before production had even started. The car is absolutely awesome.

[NorthSideSox72]

If the incentives are right, they could still build the cars in that state but sell them elsewhere. It doesn't really shoot them in the foot. A co-worker bought one of the first Teslas. He put money down on it before production had even started. The car is absolutely awesome.

I meant the STATES shot themselves in the foot. You really think Tesla, who will get big time incentives from all these states involved, is going to choose a state that told them they can't sell their cars there? No way.

 

[Y2HH]

I meant the STATES shot themselves in the foot. You really think Tesla, who will get big time incentives from all these states involved, is going to choose a state that told them they can't sell their cars there? No way.

 

If they have no where else to go they will.

[NorthSideSox72]

If they have no where else to go they will.

I think you missed the earlier information. There are four states in the final site list - two of them don't allow Tesla to sell cars there. All four will undoubtedly offer big incentives. Why on earth would Tesla choose a state who has shown a history of screwing them? No way Elon Musk is that stupid.

 

[southsider2k5]

I think you missed the earlier information. There are four states in the final site list - two of them don't allow Tesla to sell cars there. All four will undoubtedly offer big incentives. Why on earth would Tesla choose a state who has shown a history of screwing them? No way Elon Musk is that stupid.

 

It all depends on what the incentive packages look like. If they get offered enough freebies, they would locate anywhere, just like any other company. They have shareholders to keep happy.

[NorthSideSox72]

It all depends on what the incentive packages look like. If they get offered enough freebies, they would locate anywhere, just like any other company. They have shareholders to keep happy.

How is everyone missing this?

 

First, there won't be some magical thing where one state is offerring millions in tax incentives and the others aren't. They will all do it, to slightly varied extents.

 

RISK is a HUGE part of the picture when the make these kinds of decisions. It is not just about the possible reward, but the risk to that reward as well. If a state has already given them the finger, and cost them money, then you are putting the company at much higher risk of things like changing the tax goalposts or who knows what else in that state. They would be saying, hey, you screwed us before, but we'll move a giant factory that is key to our success there anyway, because your tax incentives are better by a few hundred K a year. Might as well wear a sign that says "Again! Again!"

 

And that doesn't even touch on the fact that, with a company like Tesla just getting established, reputation is important.

 

Or the fact that their future depends (much more so than other companies) on the cultural and political landscape. By choosing a state that has shown signals it isn't as friendly to their product, they are choosing a state where any future decisions made by their government (beyond just the initial deal) are much more likely to be less favorable. Shareholders want long term VALUE - the extra small amount of direct money difference in the published incentives will have nearly zero effect on value. It has to be the total impact of the move on value, not just one aspect of it.

 

A half a million dollars, or a million dollars, is all well and good. But when you are talking about basing thousands of people and your key battery facility for electric cars somewhere, you have to think much more broadly than that. That's what successful business people do.

[southsider2k5]

How is everyone missing this?

 

First, there won't be some magical thing where one state is offerring millions in tax incentives and the others aren't. They will all do it, to slightly varied extents.

 

RISK is a HUGE part of the picture when the make these kinds of decisions. It is not just about the possible reward, but the risk to that reward as well. If a state has already given them the finger, and cost them money, then you are putting the company at much higher risk of things like changing the tax goalposts or who knows what else in that state. They would be saying, hey, you screwed us before, but we'll move a giant factory that is key to our success there anyway, because your tax incentives are better by a few hundred K a year. Might as well wear a sign that says "Again! Again!"

 

And that doesn't even touch on the fact that, with a company like Tesla just getting established, reputation is important.

 

Or the fact that their future depends (much more so than other companies) on the cultural and political landscape. By choosing a state that has shown signals it isn't as friendly to their product, they are choosing a state where any future decisions made by their government (beyond just the initial deal) are much more likely to be less favorable. Shareholders want long term VALUE - the extra small amount of direct money difference in the published incentives will have nearly zero effect on value. It has to be the total impact of the move on value, not just one aspect of it.

 

A half a million dollars, or a million dollars, is all well and good. But when you are talking about basing thousands of people and your key battery facility for electric cars somewhere, you have to think much more broadly than that. That's what successful business people do.

 

If the numbers are close, I am sure they choose a friendlier state. If they aren't, you had better be able to justify it to your shareholders, or you will have a shareholder revolt/lawsuit on your hands. They care more about ROI than they do on reputation.

 

[bigruss]

If the numbers are close, I am sure they choose a friendlier state. If they aren't, you had better be able to justify it to your shareholders, or you will have a shareholder revolt/lawsuit on your hands. They care more about ROI than they do on reputation.

Shareholders care more about Tesla being able to sell the cars themselves, putting a key factory in a state that isn't allowing that tells shareholders that Tesla is okay with that legislation or knows they can't fight it. That would plummet share prices more than saving a million every year in tax benefits.

[southsider2k5]

Shareholders care more about Tesla being able to sell the cars themselves, putting a key factory in a state that isn't allowing that tells shareholders that Tesla is okay with that legislation or knows they can't fight it. That would plummet share prices more than saving a million every year in tax benefits.

 

A million dollars a year? We aren't talking about a million dollars a year here. That is the kind of incentive that goes to a big box retailer. We are talks more zeros than that.

[NorthSideSox72]

If the numbers are close, I am sure they choose a friendlier state. If they aren't, you had better be able to justify it to your shareholders, or you will have a shareholder revolt/lawsuit on your hands. They care more about ROI than they do on reputation.

 

 

Shareholders care more about Tesla being able to sell the cars themselves, putting a key factory in a state that isn't allowing that tells shareholders that Tesla is okay with that legislation or knows they can't fight it. That would plummet share prices more than saving a million every year in tax benefits.

 

Basically, the offer from AZ or TX would have to be IMMENSELY better than NV or NM offer, as well as there being some other huge non-financial incentives offered, in order for Tesla to choose one of those states.

 

[NorthSideSox72]

A million dollars a year? We aren't talking about a million dollars a year here. That is the kind of incentive that goes to a big box retailer. We are talks more zeros than that.

Raw numbers are one thing, but it is the difference between the packages - direct tax/finance and everything else - that matters. So it is more a relative thing.

 

[southsider2k5]

Raw numbers are one thing, but it is the difference between the packages - direct tax/finance and everything else - that matters. So it is more a relative thing.

 

There will be all kinds of different funding utilized in these packages, there will be property tax credits, TIF money, redevelopment money, employee training etc. It is a pretty interesting process to recruit a company now a days. I've sat on our Planning Commission for about five years now, and have gotten to see a few of things from idea to open and operating.

[iamshack]

There will be all kinds of different funding utilized in these packages, there will be property tax credits, TIF money, redevelopment money, employee training etc. It is a pretty interesting process to recruit a company now a days. I've sat on our Planning Commission for about five years now, and have gotten to see a few of things from idea to open and operating.

I know the utility companies (power and gas) serving Nevada have already had some preliminary discussions with Tesla.

 

It really is an interesting process.

[Jake]

I had to post this somewhere...

 

So, New Jersey's Governor Christie passed an Administrative Action (no need for the legislature) that effectively bans all direct car dealerships. Cars MUST be sold by third parties. This move effects exactly one company - Tesla, who will have to close it's two dealerships in the state as a result.

 

Leaving aside the amazing hypocrisy here, of Christie's touting of free markets and then doing the opposite and stifling competition... and leaving aside how awful it is for the government of a state to target a specific business this way to make other businesses happy, turning the state into a tool for businesses driving out competition... this, to me, is a great example of how the corporate money invading politics actually results in business-stupid policy.

 

Here's the kicker... there are two other states that have passed similar laws or actions - Texas and Arizona. Funny thing, Tesla is right now looking to build it's new Giga battery factory, with seven thousand jobs at the beginning and more later, as well as a possible new vehicle plant nearby with thousands more jobs. There are four states in the running - Texas, Arizona, Nevada and New Mexico.

 

This is called shooting yourself in the foot. Congratulations, TX and AZ (and NJ). Your "leaders" are lining their warchests with lobbying money, while costing jobs and tax revenue that would actually help people in your states.

 

Republicanomics.

 

While regulation doesn't always work the way it is intended, at least the left usually has a justifiable goal when they do it

 

[Balta1701]

Republicanomics.

 

While regulation doesn't always work the way it is intended, at least the left usually has a justifiable goal when they do it

I get where you're going...but you're just asking for a dozen examples in reply of regulations the left supports that similarly don't do much good except for helping a well-connected industry. Especially when you start reaching the state level they're all over the place.

[bmags]

It's a constant struggle, and one reason why I'm so annoyed by national political parties at the local level.

[Jake]

I get where you're going...but you're just asking for a dozen examples in reply of regulations the left supports that similarly don't do much good except for helping a well-connected industry. Especially when you start reaching the state level they're all over the place.

 

Well, this is why I hate state politics and would like to see them completely delegitimized/disempowered. You at least need enough political opposition that when you have free reign, you act consistently with your stated ideology.

 

In Memphis, the all-Democrat everywhere local government continues to cut pay/benefits/etc to two groups: police and sanitation workers.

 

The number 1 issue facing Memphis is crime. It is probably not as a bad as perceived, but the perception of Memphis's crime is more important. Let's reduce the police workforce! Cut their pay, too! No overtime!

 

MLK Jr. died in Memphis while standing up for sanitation workers. Somehow, in Memphis, a city largely run by black Democrats, they continue to give the shaft to the sanitation workers. It boggles the mind. Even if they were right to attack that part of the budget fiscally speaking, they're still idiots.

[StrangeSox]

MF Global customers to be paid back in full.

 

http://mobile.nytimes.com/blogs/dealbook/2...ck-in-full/#_=_

[southsider2k5]

MF Global customers to be paid back in full.

 

http://mobile.nytimes.com/blogs/dealbook/2...ck-in-full/#_=_

 

Glad to see this finally happen.

[StrangeSox]

Q1 GDP shrank by 2.9%, not the 1% previously estimated.

 

http://www.cnbc.com/id/101787838