Jerry Brown: California's deficit is gone

[Donc]

Wyatt Buchanan

Updated 12:04 pm, Thursday, January 10, 2013


Looks like the Golden States showing us the way doesn't it?

<For the first time in five years, California is not facing a deficit as Gov. Jerry Brown and lawmakers work to put together a spending plan for the next fiscal year.Brown released his budget Thursday morning for the 2013-2014 fiscal year, proposing a $97.7 billion plan that is 5 percent higher than the current year's spending.>


<The budget represents a massive change for California's finances, which at their worst in February 2009 faced a $42 billion deficit. That resulted in emergency action on the budget as the state treasurer was unable to sell short term bonds, construction projects came to a halt and the controller was forced to send out IOUs instead of tax return checks.>

Read more: Jerry Brown: California's deficit is gone - SFGate

 

[repeter]

Hallelujah!!! This made my day.

Now if we can start paying off our debt instead of using the money, I might die of happiness.

 

[CalGun]

This is based on revenue assumptions. The last time they made revenue assumptions they expected Facebook share value sales to
give them a windfall that never materialized. They are assuming a lot of things - they always do - one that people won't leave the
state to avoid the soaking the voters put on the wealthy.

 

[Donc]

This is based on revenue assumptions. The last time they made revenue assumptions they expected Facebook share value sales to
give them a windfall that never materialized. They are assuming a lot of things - they always do - one that people won't leave the
state to avoid the soaking the voters put on the wealthy.

WTF has facebook shares got to do with a CA budget?:2rofll:

 

[Carjosse]

WTF has facebook shares got to do with a CA budget?:2rofll:

Apparently the California budget was entirely based on facebook stock.

 

[Fishstyx]

WTF has facebook shares got to do with a CA budget?:2rofll:

Facebook IPO will boost state revenue - SFGate

They were expecting the revenue. You need revenue to supply your budget. Not really a hard concept to grasp.

Anyway, this is all projection at this point based on the speculation that things will be exactly the same as this year and the increase in taxes will generate their shortfall. Only time will tell if the speculation is accurate.

 

[American]

WTF has facebook shares got to do with a CA budget?:2rofll:

Trouble with you and Observer is that you can't adjust your thinking enough to see that Calgun wasn't saying Facebook had a direct connection, but that making assumptions about budgets does. So goes ahead and laugh it up in ignorance, its your loss.

 

[Dwight]

Facebook IPO will boost state revenue - SFGate

They were expecting the revenue. You need revenue to supply your budget. Not really a hard concept to grasp.

Anyway, this is all projection at this point based on the speculation that things will be exactly the same as this year and the increase in taxes will generate their shortfall. Only time will tell if the speculation is accurate.

Do you have a link for where the FB stock sale related revenue never materialized?

 

[poweRob]

Jerry Brown for president!

 

[Fishstyx]

Do you have a link for where the FB stock sale related revenue never materialized?

Yeah, I posted it. Did you actually read the article posted. The State Finance office speculated that would be around $35 a share. Whats FB's stock price? Do the math.

Its a point that its a budget projection for 2013/14. I'm not saying its not possible but they're basically saying the current changes to the CA tax rates and sales tax will have no impact and be exactly the same as last years economic activity in the state. Again, time will tell if the projection is rooted in reality.

 

[poweRob]

Hallelujah!!! This made my day.

Now if we can start paying off our debt instead of using the money, I might die of happiness.

From the article:

"That's the context of this budget, to fix the long-standing problem. We have fixed it. We're on the road to sustainable balance. It will not be easy - there will be some disagreements, there will be some heartburn," Brown said.

He vowed to be conservative with spending "instead of just enjoying the momentary high and then having the hangover many years later."​

 

[sangha]

Yeah, I posted it. Did you actually read the article posted.

No, you did not. You posted a link showing that the state projected revenue. You didn't post any link showing that the state didn't get the projected revenue

The State Finance office speculated that would be around $35 a share. Whats FB's stock price? Do the math.

It doesn't matter what FB's stock price is now. The projection was for revenues from FB's IPO, which was priced at $38, $3 above the states projection. The IPO not only sold out, but FB released more shares, so the revenue exceeded the states projections

 

[Donc]

Yeah, I posted it. Did you actually read the article posted. The State Finance office speculated that would be around $35 a share. Whats FB's stock price? Do the math.

Its a point that its a budget projection for 2013/14. I'm not saying its not possible but they're basically saying the current changes to the CA tax rates and sales tax will have no impact and be exactly the same as last years economic activity in the state. Again, time will tell if the projection is rooted in reality.

Yea, it looks like you and Jerry were right, seeings as facebook looks like its going to be a winner.Wish i had bought some FB when if first hit the market.

 

[repeter]

From the article:

"That's the context of this budget, to fix the long-standing problem. We have fixed it. We're on the road to sustainable balance. It will not be easy - there will be some disagreements, there will be some heartburn," Brown said.

He vowed to be conservative with spending "instead of just enjoying the momentary high and then having the hangover many years later."​

I know, but s**t happens you know? I'm optimistic though

 

[iguanaman]

This is based on revenue assumptions. The last time they made revenue assumptions they expected Facebook share value sales to
give them a windfall that never materialized. They are assuming a lot of things - they always do - one that people won't leave the
state to avoid the soaking the voters put on the wealthy.

Brown is just doing what Democrats end up spending alot of their time at. Fixing bad economies and getting out of debt that Republicans always seem to leave behind wherever they go.. Imagine what they could do with our other problems if they didn't have to keep doing this?
Sour Grapes must be at the top of the menu at your place.

 

[repeter]

Anyway, this is all projection at this point based on the speculation that things will be exactly the same as this year and the increase in taxes will generate their shortfall. Only time will tell if the speculation is accurate.

You make it sound like budget projections are the rarest thing in the world. I don't know why you're making such a big deal out of this. I suppose it just speaks to your fundamental opposition to government. It's a shame you let that cloud your judgement though, it makes you look really foolish, and a bit of an ideologue.

 

[repeter]

Brown is just doing what Democrats end up spending alot of their time at. Fixing bad economies and getting out of debt that Republicans always seem to leave behind wherever they go..
Sour Grapes must be at the top of the menu at your place.

To be fair, Democrats run up deficits and debt as high as anybody.

 

[sangha]

You make it sound like budget projections are the rarest thing in the world. I don't know why you're making such a big deal out of this. I suppose it just speaks to your fundamental opposition to government. It's a shame you let that cloud your judgement though, it makes you look really foolish, and a bit of an ideologue.

Especially when you add in the fact that the tax revenue from the FB IPO *exceeded* the states' projection

 

[iguanaman]

To be fair, Democrats run up deficits and debt as high as anybody.

I'm tired of being "fair". I prefer to be accurate.

$12 Trillion Calc

 

[Dezaad]

No, you did not. You posted a link showing that the state projected revenue. You didn't post any link showing that the state didn't get the projected revenue



It doesn't matter what FB's stock price is now. The projection was for revenues from FB's IPO, which was priced at $38, $3 above the states projection. The IPO not only sold out, but FB released more shares, so the revenue exceeded the states projections

He asked you to do the math. You did it correctly. He should thank you, but he won't.

He should also reconsider listening to whatever show he got this idea from about the FB IPO and California's revenue. The right wing propaganda machine makes people look like such fools when they spout what they have heard to the rest of the public.

 

[sangha]

He asked you to do the math. You did it correctly. He should thank you, but he won't.

He should also reconsider listening to whatever show he got this idea from about the FB IPO and California's revenue. The right wing propaganda machine makes people look like such fools when they spout what they have heard to the rest of the public.

I'm not holding my breath

 

[Dwight]

Yeah, I posted it. Did you actually read the article posted. The State Finance office speculated that would be around $35 a share. Whats FB's stock price? Do the math.

FB closed today at $31.45. But the IPO price was actually set over that expectation, at $38/share. The stock price fell off some on the next few days and eventually hung in the low $30 range for most of the summer. It went into the 20’s early fall but has recovered. On the 6 month settlement date it was somewhere around $28. So initial income from Zuckerberg was higher than expected and the employee income tax (withholding) was around the bottom end of the range but not significantly outside it (if at all).

Its a point that its a budget projection for 2013/14. I'm not saying its not possible but they're basically saying the current changes to the CA tax rates and sales tax will have no impact and be exactly the same as last years economic activity in the state. Again, time will tell if the projection is rooted in reality.

Well yeah, projections are projections. A whole lot of stuff can happen. But I found your claim lacking direct backing, and a bit dubious after a quick ‘doing the math’. Thus the reason for my question…as I read the article and looked into it closer than you, apparently.

 

[Dittohead not!]

I'll believe a budget surplus when I see a budget surplus.

 

[Dickieboy]

No, you did not. You posted a link showing that the state projected revenue. You didn't post any link showing that the state didn't get the projected revenue



It doesn't matter what FB's stock price is now. The projection was for revenues from FB's IPO, which was priced at $38, $3 above the states projection. The IPO not only sold out, but FB released more shares, so the revenue exceeded the states projections

Why not? Doesn't California realize tax revenue from capital gains? I think so...

In May, the California Legislative Analyst’s Office predicted that if Facebook shares hit $45 apiece six months after the IPO, and kept rising, the combination of capital-gains taxes from investors and taxes on stock awards and options for employees of the Menlo Park-based social network would bring in $2.1 billion in taxes over the next 13 months.

California Watches Projected Tax Revenues From Facebook IPO Sink With Stock Price - AllFacebook

But in reflection I hope their projections work out as predicted.

 

[Dwight]

Why not? Doesn't California realize tax revenue from capital gains? I think so…

For a huge chunk of it, the initial price was very important as that is when Zuckerberg was exercising options. at a strike price of 6 cents a share(!) so almost pure (taxable) profit for him. Note, BTW, that exercising options is NOT covered under capital gains (with some exceptions if you do not resell the shares for a lengthy period of time, if your employer has worked out an appropriate deal with the IRS).

EDIT: In case you missed it, by “initial price” I mean the $38 IPO price, which was higher than the $35 speculation linked earlier. The current price can have some bearing if options at the 6 month mark are being used at the current higher price, but a huge chunk of the expected revenue was from Zuckerberg as he had, I believe, about 1/5 of the total options for 2012 and by far the most cherry strike price.