California has hit bottom – empty pockets and no more trust funds to raid.
11/15/2011 Leave a comment
The state of California just released it’s October Statement of General Fund Cash Receipts and Disbursements. The report indicates that the annual revenue will plummet by $3.6 billion and spending will spike up by $10.2 billion this year.
California has already drawn down 85 percent of its credit lines and only has $4 billion remaining to fund a $13.8 billion deficit. With the same sovereign credit rating as basket-case Portugal, California’s debt is at maximum risk of being downgraded to “junk” bonds.” With credit lines almost tapped-out, the sovereign debt crisis that has hammered Europe may arrive in America.
More details at Cal Watchdog. California Redevelopment Agencies are paying up to 10% interest on newly issued bonds–that is how un-credit worthy California has become.