Another Domino is Tettering

And the next phase of US economic troubles begins: municipality financial failures. Unlike the federal government, US states, counties and cities can't print money. California and Illinois are both technically bankrupt, but both stumble around like zombies. California has tried to print money in the form of IOUs but this approach can't last. States are beginning to furlough and fire workers which only reduces tax revenues and increases unemployment and welfare costs.

Counties and cities face the same dilemma as states with even less resources. Chicago recently laid off cops and yesterday East St. Louis did the same. Expect more cities to shed workers as they struggle with debt repayment. Eventually cites will default on debt causing further economic shocks as bondholders get scalped.

With all of the youth and young adult unemployment there is significant risk of elevated crime and cultural deterioration. Idle hands are the devil's tools. Many parts of cities will become more dangerous as services are reduced and the the citizens are left to fend for themselves.