Posted on 05/18/2006 8:15:10 PM PDT by FairOpinion
A Wall Street bond house raised California's credit ratings Wednesday, breaking the state's long-standing tie with hurricane-ravaged Louisiana for the worst credit marks in the nation.
Standard & Poor's raised its rating on the state's general obligation bonds from "A" to "A+," and its rating on lease-supported debt from "A-" to "A." Standard & Poor's top bond rating is AAA.
"The improvement being seen in California can be traced back to strong economic growth in almost all sectors and geographic regions of the state, as well as a spike in stock market and housing-related capital gains tax revenues," wrote Standard & Poor's credit analyst David Hitchcock.
But Hitchcock noted that since the Legislature has not yet adopted a new state budget it "remains to be seen whether the state will pursue fiscal discipline with its newfound revenues."
H.D. Palmer, spokesman for the Department of Finance, said Gov. Arnold Schwarzenegger was pleased with the upgrade.
Palmer said the governor believes the timing of Standard & Poor's decision was important. It came just days after Schwarzenegger proposed spending $3.2 billion to pay down state debt and as the Legislature considers the governor's proposed spending plan.
"We have put a blueprint in front of the Legislature that achieves the kind of fiscal discipline that's valued by those who determine the state's creditworthiness. This is a validation from the financial markets that we should do what Gov. Schwarzenegger has said and treat these new revenues carefully; we cannot guarantee how long they will continue," Palmer said.
(Excerpt) Read more at sfgate.com ...
The credit rating improved when I paid my taxes.
Arnold sez it's time to borrow another $38 billion!
As if there is some doubt as to what they will do? LOL.
"breaking the state's long-standing tie with hurricane-ravaged Louisiana for the worst credit marks in the nation."
Sounds like the reason they are no longer the worst is that Lousiana's rating has taken a plunge. If you set a low enough benchmark, you can always beat it.
"Standard & Poor's raised its rating on the state's general obligation bonds from "A" to "A+," and its rating on lease-supported debt from "A-" to "A." Standard & Poor's top bond rating is AAA."
They sure are optimistic. I don't believe a word of it. You won't find me buying their bonds. The problem is that the rating agencies are already in this up to their eyeballs. If CA goes under, they will get the pants sued off them. They've got no choice but to play along with Schwarzenegger's game.
Yip!
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