As California faces bankruptcy there must be a way to profit off the ensuing panic. No one is seriously talking about this idea yet, which has slam dunk market strategy potential. This site is about the retail investor sticking it to the man. Let’s help each other on this and turn the game around. Please comment with your ideas!

As of December 2008, CalPERS managed the largest public pension fund in the United States with $179.2 billion in assets; however, that represented a 31% decrease from the peak value of its assets of $260.6 billion in October 2007.

State Public Worker Pension Fund Takes Big Hit (from SFGate):

You don’t get in a situation like we have right now, where the economy is heading in a downward spiral and you ramp up taxpayer obligations to meet those pension obligations. -California Treasurer Bill Lockyer

Calif. Taxpayers Due Refunds May Get IOUs

“If you expect you’ll be getting a refund from California when you file your 2008 state income tax return, be prepared: you may instead receive a ‘registered warrant.’”

So the question is: How can we profit off a perceived bankruptcy of California?

Short CalPERS’ largest holdings?

California Public Employees Retirement System Holdings and Details

Will risk in Cal Bonds push TLT over the edge?

What about CalPERS exposure to interest rate swaps? How can we make money off those things blowing up like CDOs did in 2008?

Does anyone know about the swaps? I don’t know enough about them and need some help.