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Bank American accepts California IOU’s: Is this a clandestine bailout from the Obama administration?
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LOS ANGELES -- Bank of America Corp. said last Wednesday it would accept warrants issued by the California government on a limited basis through July 10, "Bank of America recognizes the State of California budget crisis will impact our clients and customers," it said. "To support our customers, while giving the state legislature additional time to pass a budget, we will accept California state-registered warrants -- or IOUs -- from existing customers and clients."
Bank of America (BOA) received 45 Billion in Tarp funds and has recently announced plans to start repaying TARP funds. Many find it odd that BOA would expose itself to potential losses from a virtually bankrupt state. It is not unreasonable to suspect that the thuggish Obama administration is behind this in light of outrageous treatment that GM bondholders received. Keep in mind that California has 28 Billion in bonds maturing by October this year and already has the worst credit rating of any state in the country at A2 on the Moody’s ratings scale. This is only five ratings above speculative-grade, or junk-bond, status.
A conspiracy or coincidence?
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