By Tyler Durden | 27 January 2018
ZERO HEDGE — If there is such a thing as financial hell, it is probably Greece … with Illinois coming in close second.
For those unfamiliar, here’s a quick recap: Illinois (rate just one notch above junk) is drowning under a mountain of debt, unpaid bills and underfunded pension liabilities and it’s largest city, Chicago, is suffering from a staggering outbreak of violent crime not seen since gang wars engulfed major cities from LA to New York in the mid-90’s, while rising taxes have prompted a mass exodus with the state lost 1 resident every 4.3 minutes in 2017.
Here is just a small taste of some of our recent posts on Illinois’ challenges:
- Illinois Pension Funding Ratio Sinks To 37.6% As Unfunded Liabilities Surge To $130 Billion
- Illinois Unpaid Vendor Backlog Hits A New Record At Over $16 Billion
- Illinois Lost 1 Resident Every 4.3 Minutes In 2017, Dropped To 6th Most Populous State
- The State Of Illinois Is “Past The Point Of No Return”
- “What The Hell Is Going On In Chicago” And Other Highlights From Trump’s Speech To FBI Grads
Seen in this light, any irrational actions undertaken by the near-insolvent state would almost make sense, if not be expected. Actually make that irrational and utterly bizarre, such as a proposed offering of a mind-blowing $107 billion in debt — a never before attempted amount in the world of munis — to “fund” the state’s insolvent pension system, which would also assure that Illinois would default (even faster) in the very near future.
According to Bloomberg, Illinois lawmakers are so desperate to shore up the state’s massively underfunded retirement system that “they’re willing to entertain an eye-popping wager: Borrowing $107 billion and letting it ride in the financial markets.”
If that number sounds oddly large, is because it is: an offering of this size would be by far the biggest debt sale in the history of the municipal market, and amount to roughly 50% more debt than bankrupt Puerto Rico accumulated in the run up to its record-setting insolvency. […]