Do you live in a death spiral state? Buying real estate or municipal bonds in such a state may prove to be a foolish move. Here is a list with each state's 'taker ratio':
- Ohio 1.0
- Hawaii 1.02
- Illinois 1.03
- Kentucky 1.05
- South Carolina 1.06
- New York 1.07
- Maine 1.07
- Alabama 1.10
- California 1.39
- Mississippi 1.49
- New Mexico 1.53
Two factors determine whether a state makes this elite list of fiscal hellholes. The first is whether it has more takers than makers. A taker is someone who draws money from the government, as an employee, pensioner or welfare recipient. A maker is someone gainfully employed in the private sector.
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The second element in the death spiral list is a scorecard of state credit-worthiness done by Conning & Co., a money manager known for its measures of risk in insurance company portfolios. Conning’s analysis focuses more on dollars than body counts. Its formula downgrades states for large debts, an uncompetitive business climate, weak home prices and bad trends in employment.
Given California's death spiral, why stay there? Victor Davis Hanson supplies some reasons. And I hope you Californians do stay there. Don't come to Arizona! You wouldn't like it here anyway. Too hot, too self-reliant, too 'racist' and 'xenophobic,' and every other citizen and non-citizen is packin' heat.
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