Even California could need a bailout
You know things are getting serious when even U.S. states are saying they may need a bailout. Yikes! Here's an item on how California is having trouble raising money, and may need $7 billion from the feds ...
"California may need an emergency loan of up to $7 billion from the federal government within weeks, the Los Angeles Times on Friday quoted Gov. Arnold Schwarzenegger as saying in a letter to U.S. Treasury Secretary Henry Paulson.
"In the letter dated Oct. 2, Schwarzenegger called for the passage of the $700 billion financial industry bailout plan which the U.S. House of Representatives is expected to vote on on Friday, the Times said.
"Absent a clear resolution to this financial crisis, California and other states may be unable to obtain the necessary level of financing to maintain government operations and may be forced to turn to the federal treasury for short-term financing," Schwarzenegger wrote in the letter, according to the paper.
"A top Schwarzenegger aide followed up the letter with a call to the Treasury secretary on Thursday night, the paper said."
"California may need an emergency loan of up to $7 billion from the federal government within weeks, the Los Angeles Times on Friday quoted Gov. Arnold Schwarzenegger as saying in a letter to U.S. Treasury Secretary Henry Paulson.
"In the letter dated Oct. 2, Schwarzenegger called for the passage of the $700 billion financial industry bailout plan which the U.S. House of Representatives is expected to vote on on Friday, the Times said.
"Absent a clear resolution to this financial crisis, California and other states may be unable to obtain the necessary level of financing to maintain government operations and may be forced to turn to the federal treasury for short-term financing," Schwarzenegger wrote in the letter, according to the paper.
"A top Schwarzenegger aide followed up the letter with a call to the Treasury secretary on Thursday night, the paper said."
posted by Mike Larson at
8:52 AM
3 Comments:
In CA, the continued decline of property values and therefore property tax revenue will likely get worse.
Sooner or later CA will be forced to make meaningful cuts to their spending, which probably means layoffs of government employees.
Those layoffs will further depress sales tax revenue and may even lead to something of an exodus from CA.
Is California alone, or are there other states that may be in this type of situation?
By
Anonymous, at October 3, 2008 at 9:21 AM
I think we are headed for a serious economic crisis that could last at least 2 years. When banks stop lending, companies stop expanding. Jobs stop being made and to top it all off the price of gas is skyrocketing which effects to price of virtually all physical goods.
www.mutualfundsinvestments.net
By
rodog, at October 3, 2008 at 1:40 PM
Schwarzenegger campaigned against fmr Gov. Davis who had a deficit of 15 billion. Schwarzenegger, when he became Gov., rolled the debt into bonds to be paid by future generations. Now the Gov. has a debt of close to 20 billion and is crying for help. The only "help" I would send him are two federal marshals to take him into custody.
By
Anonymous, at October 4, 2008 at 9:37 AM
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