The Golden State.

California's GDP would make it the eighth largest economy in the world. It's current account deficit is $26 Billion [or $15 billion if you throw in a few accounting tricks].

BBR's CA Bond Ratings looking forward twelve months: 100/100. We expect CA to substantially meet all of its fiscal obligations by doing whatever it takes to keep their ratings.

BBR's CA Bond Ratings looking forward five years: 95/100. This could change depending on the economy of course. We expect California to meet its fiscal obligations. However, there is a 5% chance that California could delay payments on its bonds by more than a month in the next five years.

BBR's CA Pension Liability Index in the next twelve months: 100/100. CA will meet all of its pension obligations in the next twelve months.

BBR's CA Pension Liability Index in the next five years: 95/100 CA will default on or modify the benefits to at least five percent of its work-force in the next decade.

BBR's CA Pension Liability Index in the next ten years: 80/100. CA will default on or modify the benefits to at least twenty percent of its work-force in the next decade.

BBR's CA Pension Liability Index looking forward thirty years: 0/100. CA will substantially NOT meet its pension obligations looking forward thirty years. Either a reduction in benefits, or an increase in contributions to the defined benefits plans that depend on CALPERS is a given.

The bottom-line: California needs to convert its retirement systems from a defined benefits system [the current existing CALPERS] to a defined contribution plan [much like a 401K or 403b plan].