kind of over spending stockton is planning to renege on its debt responsibilities to investors. ed butowski is here, a magazining partner of an investments company. in plain terms explain to us, what is it that stockton is doing with its bond debt? sure, it s important to know, i mean this really hits right at the heart of all investors, because when you buy a bond there are promises that are made by that issuer. in this case stockton, california has made promises, and they said, before anybody else gets paid anything, any pension plans get paid, before any benefits we re going to make sure that the people who are putting us in business or funding our operations are going to be paid back. they ve made a promise to pay back that debt, and they are basically going against that promise and taking the bond holders, kicking them to the side and saying, we are going to take care of ourselves. we are going to pay ourselves, give ourselves benefits, we are going to pay ourselves raises and w
according to those minutes of that meeting with wall street players, also the new york federal reserve, all of them concluded there was not an imminent downgrade coming. this is likely taking wall street by surprise. we re going to be watching closely the action in the bond market. some say you could see it tick up a fraction of a point to half a point in the same year. that is what we want to watch closely. if the yield goes up, all of our borrowing costs that are pegged for mortgages and credit cards. some are saying its short term problem because there is a flight to safety from europe because the bond debt is below 3%. we ll talk to you more next hour which means to people that may be taking out loans for car or college tuition. elizabeth mcdonald will join us next hour with that kind of analysis. we look forward to it.
to run? from national level to state level and today is d-day in wisconsin. we ve heard that before but this is really d-day. it really is. and the reason is because they have to restructure $165 million worth of bond debt and it goes two weeks out which means we ve got to do it by today. also, the governor is going to be giving a speech later this afternoon and he is going to detail big cuts that will be painful for wisconsin. now, i understand he s going to do it in the assembly hall, right? that s where we ve been seeing all these pictures you ve been watching for the last couple of weeks with all the protesters there so remember over the weekend, they said hey, could you leave for a while because we need to clean? they decided to let them stay. well, now, they in fact are not going to let them come back into the premises. he is going to be giving the speech there. in the meantime, there were some very biting words that went between the governor s office and the president s