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Moody's: California Can Handle Facebook Shortfall

Moody's Investors Service said in a note Monday that California should be able to handle the potential loss of hundreds of millions of dollars from a depressed Facebook stock price.

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Comments (2)
To t6647:
It is the latter. State didn't invest in the IPO. They are assuming significant receipts from taxes imposed on capital gains and exercise of stock options, but the amount of gain will depend on the price at which the stock is sold. There is a good explanation of all this on the website of the Legislative Analyst's Office www.lao.ca.gov.
Posted by bbprint45577 | Tuesday, August 07 2012 at 5:39PM ET
It is unclear exactly how the millions of dollars are in the projected tax revenue.

Did the state actually invest in the IPO or was Gov. Brown expecting capital gains taxes assuming the IPO price would greatly increase and cause a sell off and subsequent capture of capital gains tax?
Posted by t6647m853 | Tuesday, August 07 2012 at 11:12AM ET
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