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wracket
wracket
1426 posts

Caliboredom 101

[ed. note: Do not read if allergic to (rudimentary) finance.]


Just because their credit rating dropped doesn't mean they can't borrow more. It just means that they're going to have to offer a better yield or sell the new debt at a discount to face value. Half of the markets I cover are currently borrowing on the market with lower credit ratings than California's.

Having said that, the only real way out of this in the long term is to increase fiscal revenues. And that means increasing income and/or corporate taxes. Yes, they can cut some costs, but if you look at the state of the California budget it's quite obvious that they badly need to generate more revenues to stand a fighting chance.

Jun 22, 2009, 20:25



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