Business Report: How prepared are we for the next recession?

HONOLULU (HawaiiNewsNow) - It's not that we expect a recession next week. But we know there will be one eventually. Last time, with mortgage lenders giving loans to people who couldn't afford them, and Wall Street selling risky investments under the pretense they were safe, we weren't prepared. Especially unprepared, state governments, many of which had to do layoffs.

So Moody's did a study of how prepared states are for the next one, whenever it is. It reckons a state needs at least 10% of its budget in reserve to weather a moderate to severe downturn. Moody's says 34 states don't have that much cushion, 15 of them are significantly short of that, and cushion is most lacking in Louisiana, North Dakota, Oklahoma and New Mexico. BEST prepared are Alaska, Wyoming, West Virginia and Texas. So where does Hawaii come in? Actually, pretty well. We have an 11% cushion. And that's NOT counting the rainy day fund and the hurricane fund.

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