California Vaping Ban

[bombastinator]

Well said but the Horse singing is a good one there was a Horse called Cuomo yesterday he should be on AGT, I haven't actually seen one sing out his .... before

I put it in there because I was paraphrasing a very very old story.
Iirc it’s middle eastern in origin and a favorite of Sufism.
It’s about a man who wagered a king that he could teach a horse to sing but was given no specific time limit. When asked why he would do such a stupid thing the reply was something like
“Perhaps the king will die
Perhaps the horse will die
Perhaps I will die
And perhaps the horse will learn to sing”

I don’t remember it exactly. I was very young when I learned it.

It occurs to me that if the tobacco bonds are in fact what is driving this whole thing e-cigarettes could be considered the singing horse

 

[ScottP]

It may depending on what the reasoning is. It’s possible the decision has nothing to do with health.

A post was made earlier about tobacco bonds owned by states which had something to do with the tobacco settlement back in the day (not sure how). Apparently the states doing the banning are also some of the largest holders of these bonds.

The numbers are in the hundreds of millions of dollars. I’m not sure how significant that is for a given state though. I don’t know how much money that is for a state, and how much of it they could even stand to lose. It might or might not be a significant amount of money for a given state.

Apparently these bonds retain their value based on how many smokers there are. The advent of e-cigarettes caused these bonds to lower in output much faster than anticipated and they are in danger of default. I do not know what this means. Likely someone does though. I would kind of like to.

What happened was many States were awarded large amounts of money from BT to be paid every year based on Tobacco profits. This was money that was supposedly to help cover any costs that the States would incur due to smokers health problems. The problem was rather than get this money as annual checks, many States needed a big cash infusion to cover their poor money management and rampant spending. So they sold bonds to get cash fast. These bonds will have to be paid back to the investors that bought them, with interest, at maturity of the bonds. The States were planning on paying these back with the cash from the Tobacco Settlement. Think of these bonds as a way for the States to get a loan that they were going to pay back with the Settlement money. States like NY and CA were supposed to get the most money from the settlement and therefore sold the most bonds that they are going to have to pay back.

Now thanks to already declining sales and ecigarettes exasperating the problem, the States are not getting the amount of money from the settlement that they thought they were. This leaves them without the money that they were planning on using to pay back those bonds and causing huge deficits in their cash flow. Their hope is that by killing the ecig industry many people will return to smoking and thus increasing their cash from the Settlement and easing their burden to pay back the bonds.

Selling bonds as investments is a common way for States to generate short term income (like a loan) to cover deficits or fund projects. If they start defaulting on existing bonds, investors will stop buying bonds from them, cutting off this source of money for them. So yes defaulting would be VERY bad, not just now, but far into the future for States that default on their bonds.

I hope this makes it clear.

 

[bombastinator]

Who Has The Most Tobacco Debt?

Terry helpful. Thank you. Also explains why I know so little. I live in Minnesota. The state sued separately. I guess that means that if the bonds are the real issue I won’t be affected.

 

[jandrew]

I put it in there because I was paraphrasing a very very old story.
Iirc it’s middle eastern in origin and a favorite of Sufism.
It’s about a man who wagered a king that he could teach a horse to sing but was given no specific time limit. When asked why he would do such a stupid thing the reply was something like
“Perhaps the king will die
Perhaps the horse will die
Perhaps I will die
And perhaps the horse will learn to sing”

I don’t remember it exactly. I was very young when I learned it.

It occurs to me that if the tobacco bonds are in fact what is driving this whole thing e-cigarettes could be considered the singing horse

However, in this case it may be the lesser known parable where the King/Sultan shoots the horse and beheads the man anyway.

 

[englishmick]

What happened was many States were awarded large amounts of money from BT to be paid every year based on Tobacco profits. This was money that was supposedly to help cover any costs that the States would incur due to smokers health problems. The problem was rather than get this money as annual checks, many States needed a big cash infusion to cover their poor money management and rampant spending. So they sold bonds to get cash fast. These bonds will have to be paid back to the investors that bought them, with interest, at maturity of the bonds. The States were planning on paying these back with the cash from the Tobacco Settlement. Think of these bonds as a way for the States to get a loan that they were going to pay back with the Settlement money. States like NY and CA were supposed to get the most money from the settlement and therefore sold the most bonds that they are going to have to pay back.

Now thanks to already declining sales and ecigarettes exasperating the problem, the States are not getting the amount of money from the settlement that they thought they were. This leaves them without the money that they were planning on using to pay back those bonds and causing huge deficits in their cash flow. Their hope is that by killing the ecig industry many people will return to smoking and thus increasing their cash from the Settlement and easing their burden to pay back the bonds.

Selling bonds as investments is a common way for States to generate short term income (like a loan) to cover deficits or fund projects. If they start defaulting on existing bonds, investors will stop buying bonds from them, cutting off this source of money for them. So yes defaulting would be VERY bad, not just now, but far into the future for States that default on their bonds.

I hope this makes it clear.

A bit clearer. I saw mentions in the article regarding some expectation that if smoking rates went down the investors would suffer the loss rather than the States. It wasn't really explained, not enough for me anyway.

 

[Baditude]

Terry helpful. Thank you. Also explains why I know so little. I live in Minnesota. The state sued separately. I guess that means that if the bonds are the real issue I won’t be affected.

I think that for you, the real issue will be the banning of flavors will be the end of the vaping industry in your state.

Then again, if Trump and the FDA bans flavors nationwide, it will be the end of the vaping industry in the US.

 

[ScottP]

Oh, I said nothing about ethical or honest politicians, they likely don't exist in today's world. I imagine nearly every politician didn't get where they are without accepting campaign monies, many from tobacco or pharmaceutical companies. Those companies generally expect some special interest favors in return for that money. I'm sure that most politicians spend a great deal of their time in office campaigning for their next campaign donations.

Trump's top health official traded tobacco stock while leading anti-smoking efforts

CDC director who traded tobacco stock resigns

I have been telling people for years that politicians invest in stocks/companies then write/support laws that benefit those companies. These articles you linked to only prove my point. It's how they can get a $174,000/yr salary and still make millions in just a few years. I have also been calling for that behavior to be classified as insider trading but that of course will never happen.

Here are some of my old posts discussing this very topic:

From Oct 8, 2017:
Who will deeming effect in the vaping community?

Sadly most of Congress should probably be brought up on RICO charges or insider trading at the least. Most of them invest in stocks and then vote on legislation that affect those same stocks. Republicans do this more with Coal, Petroleum, and military product companies, while Democrats do this more with Pharmaceutical, Tobacco, and green energy companies. This is why both sides fight the battles they do and is how they can have salaries of only $174000 but still make millions per year.

From feb 22, 2018:
Deeming Regulations have been released!!!!

<snip>
The third source is that politicians have figured out how to "vote themselves rich". Have you ever wondered how a Congressman or Senator and can get elected, earn $174,000/yr and be multi-millionaires in just a few years? It's simple they invest in a company/industry that they are beholden to due to campaign contributions from their lobbyist, then write/sponsor a bill that helps that company/industry, then get that bill passed. Their lobbyist buddy is happy because they got what they wanted, and the politician essentially gets paid 3 times (campaign contributions, base salary, and investment payouts) for doing his work. The only difference between the two parties is which industries they are beholden to and thus support. The solution here is to fix the prior two problems, AND make it be considered "insider trading" to vote on a bill in which you have a financial interest in. Again the people that would have to pass this law are the very ones benefiting from this scam.

 

[AttyPops]

Then again, if Trump and the FDA bans flavors nationwide, it will be the end of the vaping industry in the US.

I give best odds of that happening, as compared to "individual state rules". FDA/CDC, BT, BP, all have interests in this. And if the end game is ending tobacco smoking, this is part of the process to get there. Sure, taxes and money are in it, but with complicit knowledge by everyone involved that "we have to get there and make deals".

Vaping as we know it is too successful and too open. BT money and really a chunk of the USA's economy is part of all this. As well as long term healthcare costs. It's not one thing, it's everything at once. With a dog and pony show.

Same for vilifying the green.

Best guess.

 

[zoiDman]

... I guess that means that if the bonds are the real issue I won’t be affected.

"In Minnesota, an analyst from the state House of Representatives did the math on selling $700 million worth of tobacco bonds — more than the $640 million that ended up in the final budget deal. The analysis found that it would cost the state $315 million in debt service over the next two years to access that $700 million upfront, bringing the total cost over the 20-year life of the bonds to total some $1.2 billion. The analysis cautions, however, "These preliminary estimates are highly dependent on the market at the time of the sale, the state's bond rating, and the structure of the bonds; they are subject to change."

Tobacco Bonds to Rescue Minnesota, for Now

Why Worry about the Future when we can get 45 Cents on the Dollar Today !

 

[iVapeDIY]

I read today that Trump received half million dollars in campaign money from Big Tobacco. His former health director bought interrests in BT while publically calling for less smoking. Former cabinent members are currently working for BP, BT, or Juul. They are all corrupt.

Tobacco and E-Cigarette Lobbyists Circle as F.D.A. Chief Exits

Altria gave $500,000 to Mr. Trump’s inaugural committee​

Trump Wants FDA To Ban Flavored E-Cigarettes

As the White House weighs banning flavored vaping products from the market, worth noting that several former WH advisers took jobs at Juul after departing: Josh Raffel, former Jared Kushner aide; John DeStefano, former political adviser; and former Pence aide Rebeccah Propp​

 

[AttyPops]

worth noting that several former WH advisers took jobs at Juul after departing: Josh Raffel, former Jared Kushner aide; John DeStefano, former political adviser; and former Pence aide Rebeccah Propp

Yeah, and Juul changed their tune when acquired by BT.

The fix has been in for a long time.

But non-selfishly, in a way, it's not all that bad. Think of the unborn grandkids... "smoke free future" can be real. I mean, well....it might actually work. We give up a better product for our (us fossils that switched from smoking) needs.

 

[bombastinator]

What happened was many States were awarded large amounts of money from BT to be paid every year based on Tobacco profits. This was money that was supposedly to help cover any costs that the States would incur due to smokers health problems. The problem was rather than get this money as annual checks, many States needed a big cash infusion to cover their poor money management and rampant spending.

kind of judgy. “Poor, rampant” pretty much every government ever has had these same problems. Whether they’re “poor” or “rampant” though is a different issue. They do seem to be states with big cities in them. Cities are where the downtrodden have fled from bondage to since the Middle Ages. They have tended to have work and provide protection from the landed gentry. Such things aren’t free though.

So they sold bonds to get cash fast. These bonds will have to be paid back to the investors that bought them, with interest, at maturity of the bonds. The States were planning on paying these back with the cash from the Tobacco Settlement.

Which would have worked barring singing horses like e-cigarettes

Think of these bonds as a way for the States to get a loan that they were going to pay back with the Settlement money. States like NY and CA were supposed to get the most money from the settlement and therefore sold the most bonds that they are going to have to pay back.

but how big are they relative to income? I’m seeing hundreds of millions, but BT just spend more than twice that on a single advertising campaign. Clearly it’s chump change for BT, but what about the states?

Now thanks to already declining sales and ecigarettes exasperating the problem, the States are not getting the amount of money from the settlement that they thought they were. This leaves them without the money that they were planning on using to pay back those bonds and causing huge deficits in their cash flow.

“huge” is not a number. It’s an opinion.

Their hope is that by killing the ecig industry many people will return to smoking and thus increasing their cash from the Settlement and easing their burden to pay back the bonds.

that depends on a lot that isn’t stated. Apparently “tobacco bonds” weren’t issued as a single thing but were issued separately by each state in question so they’re all going to be different for each state. How are they backed? Who owns them? What are the terms? It’s going to be a bit different for each state. NY and MI and CA seem to be the ones making moves. What are their specific positions? This is still “if” not “why”

Selling bonds as investments is a common way for States to generate short term income (like a loan) to cover deficits or fund projects. If they start defaulting on existing bonds, investors will stop buying bonds from them, cutting off this source of money for them. So yes defaulting would be VERY bad, not just now, but far into the future for States that default on their bonds.

it wasn’t till @Baditude ’s post that I got a what little of a basic handle on what they even are as I have. The bonds are issued to private investors by the states so yeah they gotta cover em.
I knew the Minnesota attorney general kicked ..... Apparently more than I even thought.

What isn’t clear is how big a problem these bonds represent for which states are. This is all about motivations, and the amount of problem is the potential motivation or lack of it.

 

[ScottP]

Sorry I am not the State Comptroller for either CA or NY.

 

[bombastinator]

I think that for you, the real issue will be the banning of flavors will be the end of the vaping industry in your state.

Then again, if Trump and the FDA bans flavors nationwide, it will be the end of the vaping industry in the US.

Flavorings I like but don’t need. Looking at the tobacco settlement map it’s unlikely that trump will help. Most of the states that are going to have problems are blue, and if there’s one thing that’s clear about trump he is about trump and no one else. And therefore whence red goes trump goes. He just louder and cruder and more stompy about it.
My main worry is nic base. It’s not made in my state that I know of.

 

[Baditude]

My main worry is nic base. It’s not made in my state that I know of.

So do you DIY? Are you well stocked? I imagine there will be a run on nic base in the next couple of months as people stock up and suppliers will run out of stock quickly. I've seen it before.

 

[jandrew]

...
I knew the Minnesota attorney general kicked ..... Apparently more than I even thought.
...

Referring to what?
I don't know what Minnesota's current status with their bonds is, but the state did do a bond release in 2011 against future MSA payments:
Minnesota finalizes sale of $757M in tobacco bonds – Twin Cities

 

[bombastinator]

So do you DIY? Are you well stocked? I imagine there will be a run on nic base in the next couple of months as people stock up and suppliers will run out of stock quickly. I've seen it before.

DIY I’ve done for years. I have about 8 months worth and just bought another half liter of 100mg/ml base. Should be good for maybe a year. Flavorings and hardware excluding base I have too much of. If I have to I suppose I can learn how to make NETs. Honestly I’d rather find a different anti anxiety med if it comes to that though. They’re all bad. 10 years ago when I started this nicotine was the least bad of them. May no longer be true. The screw of knowledge keeps turning.

 

[Baditude]

Honestly I’d rather find a different anti anxiety med if it comes to that though. They’re all bad. 10 years ago when I started this nicotine was the least bad of them. May no longer be true. The screw of knowledge keeps turning.

Go right ahead supporting our "friend" Big Pharma. Playing right into the Master Plan along with the FDA and Big Tobacco.

How about Chantix? It's only killed 80 people, so must be considered safe by FDA standards.

Chantix blamed for 3,063 serious injuries and 78 deaths

 

[bombastinator]

Referring to what?
I don't know what Minnesota's current status with their bonds is, but the state did do a bond release in 2011 against future MSA payments:
Minnesota finalizes sale of $757M in tobacco bonds – Twin Cities

They’re apparently not part of the standard settlement according to the map.

Reading your link though it looks like they got a lot more out of BT than other states did. Looking at your link the bonds also aren’t backed by the state exactly since the taxing authority isn’t involved.
Might explain the local 90something percent excise tax on B&M ecig stuff though. I’ll look into this one more perhaps. This might be a problem already solved.

 

[bombastinator]

Go right ahead supporting our "friend" Big Pharma. Playing right into the Master Plan along with the FDA and Big Tobacco.

How about Chantix? It's only killed 80 people, so must be considered safe by FDA standards.

Chantix blamed for 3,063 serious injuries and 78 deaths

I didn’t say I liked it. I’ve got around 10 months though at any rate even if a full national ban goes through tomorrow. The whole “stock up now!!” thing still feels like all those “they’re about to ban firearms!!” things that have happened what? Six time now? That turned out to be marketing garbage from firearms manufacturers and there are all these poor guys now with thousands of dollars tied up in hundreds of firearms each bought at top dollar that they can’t get rid of.