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Moody's Junks More Than $300 Million of Fresno, Calif., Debt

JAN 24, 2013 7:09am ET

Moody's Investors Service downgraded more than $300 million in Fresno, Calif., debt to speculative grade.

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Comments (4)
The drum beat of downgrades for California issuers is in the early stages. It stems from a dysfunctional state government and governing philosophy that pretends high marginal tax rates and onerous, even if well intentioned, regulations will have minimal impact on business and the state's economy. The jury is in on such strategies: they inevitably lead to lower and more volatile tax receipts and a slow growth to negative growth GDP accompanied by out migration of higher income people as well as businesses. Too bad for California's municipalities that the states' politicians refuse to accept this verdict!
Posted by mdwjr | Thursday, January 24 2013 at 9:21AM ET
I agree completely with your comments. The next bug hammer for all municipalities is the unfounded pension liability. Who deserves 80-90 percent of their pay when they retire. Greed and stupidity are going to be their demise.

Also the high tax rates for the people out their working is going to drive them to another State. Then who is going to pay for the people that will not work.

This entitlement nation is a disgrace
Posted by t20999m193 | Thursday, January 24 2013 at 11:26AM ET
When did BondBuyer comments turn into Fox News?
Posted by Stephen W | Thursday, January 24 2013 at 2:37PM ET
I'll take the truth regardless of the source! If more would do the same, we could address some of these unsustainable entitlement issues.
Posted by mdwjr | Friday, January 25 2013 at 5:33PM ET
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A recent phenomenon is the emergence of bonds with shorter call protection as funding alternatives for municipalities. However, the shorter call protection also dampens the potential upside for investors, which in turn reduces the price they are willing to pay.

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