California busted! Issuing IOUs.
Submitted by bizgrrl on Thu, 2009/07/02 - 5:28pm

The need for the IOUs rose during California's recent budget crisis, in which the state's deficit reached $24.3 billion. State officials have said that 28,742 IOUs worth $53.3 million will be printed.

As of today, the IOUs will be redeemable on October 2. Some banks (Wells Fargo, Bank of America, ), and Chase are accepting the IOUs.

Acceptance means that, in effect, the banks are floating loans to the state for the value of the IOUs. Indeed, the state said Thursday it would pay an annual interest rate of 3.75 percent on IOUs, which must be redeemed by the state by Oct. 2.

This is the second time this has happened since the Depression (the first time was apparently in 1992). Let's hope the Federal Government will continue to print money.

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R. Neal's picture

the first time was

Submitted by R. Neal on Thu, 2009/07/02 - 5:31pm.

the first time was apparently in 1992

Say, wasn't that at the end of another long era of GOP rule? If history repeats itself, does that mean happy days are here again?

Virgil Proudfoot's picture

Gulley-Vornians smoke too much weed

Submitted by Virgil Proudfoot on Fri, 2009/07/03 - 6:57am.

Both houses of California's legislature have passed a single-payer health-care bill, twice. And the goobernator has vetoed it both times.

This all goes to prove that Gulley-Vornians are not social pot smokers.

Tess's picture

As Callifornia goes, so goes the nation?

Submitted by Tess on Fri, 2009/07/03 - 9:17am.

I hope the saying isn't prophetic...

Rigsby Werner's picture

What is Amazing is that California once had the economic

Submitted by Rigsby Werner (not verified) on Fri, 2009/07/03 - 10:14am.

engine and underlying economic strength to support the billions of dollars in programs and state initiatives with balanced budgets before they started spiraling into deficit spending following the dot com bust in 2000. A number of major, major businesses and industries have left California as the costs of doing business in California are simply to great to justify operating there unless there is no other alternative.

shannonsz's picture

go east, not west

Submitted by shannonsz (not verified) on Fri, 2009/07/03 - 12:07pm.

there was a time one would go east...moving costs reflect this as it was higher to move west. Now costs to move east are higher because everyone is moving.

there are large sections that don't even speak english nd large crime areas.

I still can't figure out where the residents get the money to pay the half million to million dollar home cost.

mobile home communities are around seven to eight hundred a month and the mobile home on the rented space was down to around 200k from 250k a couple of years ago.

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