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FBN’s Liz MacDonald on the tax revenue California will receive from the social-networking website.
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While the broad city California is not going to get as much money as they thought from FaceBook in -- -- looks like this shortfalls gonna be something like 700 million dollars Elizabeth MacDonald looks there up.
With more on this -- this about you know.
They really thought this is going to be John -- yet we just.
-- that number this morning -- what happened was California thought that Facebook's IPO.
-- sticking around 35 bucks even though it's said to themselves look last may it's going to be a 42 dollars by November.
It -- -- one and a half billion dollars but now because the stock drop.
Obviously they're seeing in the U restated that by nearly 50%.
So 700 million less -- they -- -- or insiders to sell their stocks I guess in the forties take the big profits and -- -- -- with these big taxes.
Yeah that's right and -- other deal going on California it doesn't appear that they took into account the fact that a third of the upper brackets people may have invested in the IPO.
We'll have left this state -- -- seven and 09.
And now California is telling the world look at you know because of the confidentially of tax returns -- estimates may have been way off and then in the future get a lump and -- FaceBook tax revenues because of this embarrass me embarrassing -- snap flu with the -- they actually another we're talking Jerry -- was making budget decisions based around FaceBook IPO would fall out talking about yet now let's say it's saying hundreds of millions of dollars are at risk because of the over statement from the FaceBook IPO on any issue for Californians is this.
Whenever California overestimate their credit state -- estimates what they expect.
They fill in the pot holes blown out by they were over estimation.
With raising other taxes like sales tax assets -- -- that's real priority the other threatened California is notorious for relying heavily on income tax -- income taxes in the state.
For its budget so this is a real -- -- -- problem for taxpayers and teleport.
The other thing about this that everyone -- was the more you only get tax revenue when you sell the shares -- and there's limitations on these insiders want how many shares they can sell when they can sell them so the idea that also and they went public in -- rules gonna sell their shares.
It's just -- he almost wonder are they prop.
I think most uncomfortable tax revenue although -- hard it is even more limited when it's when he tuneup for -- -- -- -- very.
Something you know what three cities now in California file for bankruptcy protection -- -- the states really start to grab for a lot -- doesn't count us calpers all along they've been estimating David make 8% a year in the stock market mean isn't this is typical Californian and that's.
Like Bernie Madoff promising and every year I hate to say that -- but really I mean it can't be doing that anymore.
Maybe 4% going for -- 8% every year at any.
He knew that calpers was going off the rails when after the bubble person started investing more in skyscrapers in real estate so.
You know watch -- for these pension funds to that's it hidden story that people really don't look at to what the pension funds are doing with their estimate.
Its bottom line Californians and for some real tough sledding ahead yeah -- and a price in these silly assumptions I hope the voters are -- Hey thanks a lot you know what no one crutches and -- -- it sure they.
