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Pastimes : Clown-Free Zone... sorry, no clowns allowed

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To: Simba who wrote (249462)	7/11/2003 6:31:49 AM
From: geewiz	of 436258

Have others noticed the D word being used with reference to California recently? Could California Default? Consider the Possibility: Joe Mysak July 10 (Bloomberg) -- The D-word is now being used in connection with what's going on in California. D as in default, as in not paying one's debts. This is rare in the municipal market, occurring less than one- half of 1 percent of the time. California would be the first state to default. ``Any payment default would lead to a lowering of the long- term ratings to a high speculative-grade level,'' Moody's Investors Service said last week when it placed $34 billion of California's bonds on review for a possible downgrade. The Moody's language was meant to hearten investors. The ``high speculative grade level'' in the event of default would be merited because ``recovery of loss would likely be 100 percent,'' the ratings company said. That's the good news. The bad news is that this is the first time Moody's has used the word default in their updates on the state. Default is not a word lightly tossed around in the municipal market. Most market participants refuse to believe in the possibility. quote.bloomberg.com hope everyone held some mbi calls! later,art

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