California Turns to JPMorgan for $1.5 Billion Loan

[sabra]

Source: Reuters

California will pay no fees and 3 percent interest on a $1.5 billion loan from JPMorgan Chase that will provide the state with money to pay its recently issued IOUs, State Treasurer Bill Lockyer's office said on Thursday.

The government of the most populous U.S. state issued the IOUs, which carry a 3.75 percent interest rate, to conserve dwindling cash during its recent budget crisis.

California is scheduled to begin redeeming the IOUs, issued to taxpayers owed refunds and vendors, on Sept. 4.

The state through Tuesday had issued 414,000 of the IOUs, technically registered warrants promising payment, worth $2.26 billion, according to the state controller's office.

Read more: http://www.cnbc.com/id/32584157

[Robb]

1. Well.

I can't see anything that can possibly go wrong with this plan. :rofl:

[tomm2thumbs]

2. I always ask her for money

at least when I'm really about to get the Gong

[Walk away]

3. Are they going to have to change the State's name to J.P. Morganland?

They sell everything here in N.J. and rename it for the company that bought it. Highways and arenas all have investment bank names. We have probably sold the entire state several times but not to just one company. This could make it much easier for Calafornia to rebrand itself. It even sounds more solvent and it would be more likely for the federal government to bail it if it sounds like a bank.:sarcasm:

[pinto]

4. Probably the best deal Lockyer could find given the state's bond rating. It was

also a given that CA would need to borrow this fiscal year to pay its bills. The only question was how much and at what interest.

[Soylent Brice]

5. *forehead slap*