Thursday, April 29, 2010

Municipal Default



Cities & states during the housing bubble (wisely, of course) assumed housing prices & tax revenues would go up forever so they could keep spending like drunken sailors (following the federal example). Now the cities will have to be saved by the states, which are already in steep deficits, so the feds will have to come to their rescue. (But that's OK because the Treasury is just flush with excess cash, right?)

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