Investors gobbled up California’s general obligation bonds the last couple of days and that could be a positive indication that the market might look favorably on California’s fiscal fix.
On Monday, I suggested that the sale of general obligation bonds offered by the state would be an early test of investors’ attitude toward some Special Election ballot measures.
Proposition1C in particular, the lottery modernization measure, needs Wall Street to plunk down billions to help balance the budget with payoff to investors from lottery proceeds down the road.
Treasurer Bill Lockyer sold around $2.5 billion more in bonds than he originally anticipated putting on the market. About half the bonds were taken by individual investors, the other half by institutional investors. Relatively high interest rates accounts for some of the bond sale success. However, the successful offering also indicates that investors have positive feelings about California’s economic stability. That could bode well for Prop 1C if the voters support it in May.
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Jerry Roberts and Phil Trounstine of Calbuzz.com posted seven key questions candidates for governor should answer. The next day they had a response to all seven questions by Republican gubernatorial candidate Tom Campbell.
In response to a question on economic development, Campbell, the law professor and former congressman and California Director of Finance, addressed problems facing business such as extensive regulation and job killing lawsuits. Campbell called for a rolling sunset review of all existing regulations and discouraging lawsuits by requiring the losing party to pay some of the costs.
Campbell called for multiple infrastructure improvements to attract and keep jobs and to lower taxes in line with competitor states. At the same time, he supported the rainy day fund in Proposition 1A on the Special Election ballot as a good start toward fiscal reform. He also advocated keeping Proposition 13 in place, including on commercial property, to encourage businesses to move to California.
You can read Campbell’s complete answer on economic development as well as his answers to the other questions posed by Calbuzz here. The questions are on the top of the page. Roll down the page to find Campbell’s answers.