Thursday, July 2, 2009

California rolls out IOUs!

Unbelievable and sadly expected, the Californian government could not settle on a budget to move forward on. According to SF Gate, the state has run out of money, and begun to issue IOUs to "thousands of vendors who provide goods and services...".

IOUs = empty promises

The IOUs probably won't be cashed by the state for 90 days - and then only if the treasury has the money to cover them.

This is bad. Without proper cashflow, many Ca government vendors face extreme difficulty or simply bankruptcy. Volatility is about to make a come back.

Russia Today on the Californian Budget Crisis

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