ATM to guy depositing California state IOU: "Come back without a [registered] warrant."
Clearly the machine knows something we Californians do not. Boing Boing reader Adam Heitzman sends in this iPhone snapshot and says,
Here's a comical sign of the Econopocalypse. It's a picture of a Chase ATM in Sacramento telling me "Registered warrants issued by the state of California are not accepted."And in the state capital, no less. [shakes head with sense of foreboding doom].Registered warrants are IOUs. California is/was something like the 6th largest economy in the world and the bank is saying "cash only, thanks, NEXT!"
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The State Controller's Office has some info on who will take the warrants (and a lot of suggestions that you should call your bank and ask):
http://www.sco.ca.gov/eo_news_institutions.html
Besides Chase, BofA, Wells Fargo and Union Bank have refused to take them. Citibank still will - but only for another week.
Nothing comical about it. Wait until people in Compton or Watts start getting those messages.
well that's it then... says a lot when banks stop taking your scrip and want hard cash...
Also, I'm surprised I can't find any of these California warrants for sale on eBay. I'd probably buy a couple just for the novelty/collectible value. This is basically a case where a state is trying to issue its own currency, and that's historically interesting.
If California can't pay up, why are its creditors still paying California taxes and tariffs?
If I ran a business in CA and had some of these worthless scrips, I'd simply withhold the funds from CA sales tax. Common sense. You don't keep loaning money to a deadbeat.
And the state legislature STILL isn't seriously considering the legalization of marijuana. Even when the Republican governor has voiced interest in the idea.
One of the state's biggest expenses could become a major source of tax revenue overnight, and the so-called liberals running the place would rather shut down social services entirely than look soft on drugs.
I saw this just yesterday on a Chase ATM here in LA.
Ted8305:
My first reaction to this idea was, "California may be a deadbeat, but it still has a police force. Good luck with that." Then I realized: not for long.
CHASE, BANK OF AMERICA and most of the major banks and credit unions in ca have publicly stated that the states IOU is no good and will not be honored as legal tender. this happened the last time the state issued these I wonder why they thought this would work this time.
That message was on the welcome screen at Wells Fargo about two weeks ago.
Does anyone in California not know this? The warrants stopped being accepted by banks and cautious investors shortly after their use started. I think most people are of the opinion that they're probably worthless.
Ted8305:
If I ran a business in CA and had some of these worthless scrips, I'd simply withhold the funds from CA sales tax. Common sense. You don't keep loaning money to a deadbeat.
As I understand it, one of the things the warrants are good for is paying the State - so you can pay your CA sales tax with them, to the same effect.
Doesn't make the rest of this mess any better, or the state any less deadbeat, but there is at least that.
It's not the apocalypse. Basically, these things are short term bonds with a 3.75% interest rate. Nobody wants to lend money to California at that rate. If they paid a bit more interest, the banks would probably take them.
ah ha ha ha the economy is tanking. The State governments are issuing IOU's to the citizens, and then the private banking system responsible for this catastrophe are denying the validity of the IOU's. Basically they decide what money is and how much it is worth. Bow to your masters.
California's economy is/was around the 6th largest in the world - and probably still is. It's only the state government that is going broke - only a small portion of the overall economy.
(I'm sorry to quibble, but this misinformation keeps popping up everywhere.)
@2, I suppose you mean that because people in Compton and Watts are all constitutional scholars and will take this to the courts. Or perhaps you mean to say that the people of Compton and Watts are less than willing to seek legal redress?
people get the government they deserve.
I'm surprised that the bank ever accepted them for a deposit. They're not checks, after all, unless you've ever had a checking account where you could kite them for three months.
I knew this and I live in Massachusetts. It was being widely broadcast on NPR last week.
Check out the information on this super highway!
@ #6 Brainspore
They probably aren't going to get to it until next year, but Assembly Bill 390 is being proposed Tom Ammiano. It would legalize and tax marijuana, set up licensed cultivators, wholesalers, and retailers. Individuals would be allowed to cultivate 10 plants, out of public view, for personal use.
Considering Prop 5 went down in flames last November, I'm not holding my breath.
Something just occurred to me- what would happen if you tried to pay your state taxes with those IOUs?
remember that "webcam view" of the Large Haydron Collider start-up? Something like that.
Does anybody know which bus goes to Bartertown?
-- MrJM
MRJM, things would be a lot more simple, plus plus since it is California it would totally be like that Tupac video.
http://www.youtube.com/watch?v=FWOsbGP5Ox4
Takuan, there's no 'y', it's like "hardon", but with the 'd' and the 'r' transposed.
aw shaddup and pass me the bottle
Not on eBay, but there are some postings on Craigslist offering to buy registered warrants for face value or 90 cents on the dollar (see http://sfbay.craigslist.org/sfc/wan/1274180099.html for example). Not a bad deal for someone willing to take the risk, if they have faith that they can cash them next fall and collect the interest. Not much interest there, but that rate is a helluva lot higher than most banks are paying on CDs and savings accounts.
http://www.chase.com/CAwarrants
redirects to:
https://www.chase.com/ccp/index.jsp?pg_name=ccpmapp/shared/corporate/page/registered_warrants
Bust a deal and face the wheel!
This is new? They've been all over the ATMs in Seattle for weeks now. I didn't know what a "warrant" was until this post. Thanks!
For this we bailed out Chase, BofA, Wells Fargo, and Citibank? I know! Let's start calling Schwarzenegger the the Collector!
Clearly the machine knows something we Californians do not
Wtf? Only Californians who've been under a rock for the last few months. Hell, I live 6,000 miles from California and I knew this. Where have you been hiding?
California should start a state bank
F Chase.
Got one of these the other week. I had an extension to file and ended up filing pretty late. I opened the mailbox and saw something from the state, and when I opened it up the first thing I saw was "registered warrant." Having no idea what that meant, I assumed that there was a warrant for my arrest.
According to the warrant/"check," it will become cashable in early October.So I won't get my return until then.
This is quite easily the funniest thing I read today.
So.. they invented another form of money. But there are no exchanges between CaliforniaWarrant and AmericanDollahs, and neither side thinks the other is worth the paper it's printed on?
I read somewhere that the financial troubles are (partly) caused by ballot initiatives that strongly limit the tax revenue for the state.
Which reminds me of this quote:
Democracy is the theory that the common people know what they want and deserve to get it good and hard.
--H. L. Mencken
A Registered Warrant is a short-term savings bond that's issued by the state treasury instead of the federal treasury.
It's same thing people have been depending on for financial security for the last 150 years, a loan to the government by the body politic. 10% of the pay of most US soldiers is in the form of these notes. It's not currency, and never has been.
See also:
Tragedy of the commons.
My first through when reading -
"Registered warrants issued [...] are no longer accepted for deposit"
- was simply "Who is depositing these things? Bounty hunters?"
I didn't realize a warrant also meant the funny-money I.O.U's California state was issuing. :)
-Blayne
@Ted8305: The last time California issued warrants, I signed the warrant and mailed it back as part of my sales tax payment with a note saying that since the state felt this was a valid payment to me, I knew they'd be delighted to accept it as payment. Never heard a peep from them in complaint.
The problem is that a number of businesses who contract with the state get most of their income from the state. So even using the warrant to pay sales and income tax leaves a big cash hole when it comes to payroll and other expenses.
However, the problem isn't as bad as it sounds. While my business bank won't take them, my personal bank is glad to, at face value. (The warrants pay interest.) The city where I live will also buy them at face value.
The banks aren't refusing them because they think the state might default. The banks are refusing to take them in order to put pressure on the legislature to clean up the mess, figuring the bank's customers will beat up on their elected officials. They quite openly state this.
Unfortunately due to extreme gerrymandering this won't work. The voters are mad at all the legislators except for the "good guy" in their own district...and particularly at the boneheads in the other party. Whichever party that might be.
As for the lack of eBay sales - that was foreseen (unlike so many other features of this disaster) so the warrants can be sold or exchanged only through "registered agents". Essentially they're being treated like securities.
I was pretty surprised this afternoon when I got an email from the BOE (California sales tax people) saying they weren't required to accept the IOUs but they would. (http://www.boe.ca.gov/news/2009/65-09-G.pdf) I would have thought they'd be required to accept it.
The state controllers office has announced that effective Sept 4, the IOU's are redeemable. In spite of this, Chase is still refusing to accept them. I know, because I tried to deposit one on Sept 5th. Wells Fargo is accepting them effective Sept 4 and B of A will accept them on Sept 9. Meanwhile, Chase, who recieved government money when they bailed out WAMU and who loaned the State of California 1.5 billion to aid in the early payouts, is still refusing. One can only guess as to their plans. The warrants are now legal tender, not IOUs and longer. Why are they still refusing to accept them? While Wells Fargo and B of A are planning to accept the checks and then provide the depositors with the interest, I'll bet Chase is planning on not accepting them until October and then keeping the full interest for themselves. Just a guess on my part. I will be searching later this next week, for a bank that is more user friendly and less of a Blood Sucker.
I concur with poster #46.
Chase should be chastized by both the Federal and the State Government for the lack of "Customer Service."
It will be interesting to see what happens after October 2, 2009, if they will even accept them then!!!!!
Signed.....Frustrated WAMU Depositor
I concur with poster #46.
Chase should be chastized by both the Federal and the State Government for the lack of "Customer Service."
It will be interesting to see what happens after October 2, 2009, if they will even accept them then!!!!!
Signed.....Frustrated WAMU Depositor
Chase is the only major bank STILL not accepting warrants, despite the fact that it has been announced that they are now being honored by the state (almost a month earlier than planned). Now THAT'S absolutely ridiculous. Shame shame, WAMU/Chase!
Chase is STILL not accepting them, here it is October 3rd. I have been holding onto my IOU for MONTHS waiting for "my bank" to get with the program, there is no sign that they will EVER plan on accepting them! Shame on you. I will definitely be banking elsewhere from now on.