A Brand-New Arbitrage Market for California's IOUs

Minyanville:

And now: an arbitrage market for California’s IOUs. Who says capitalism is dead?“If you are receiving a California IOU and need cash immediately please contact me ” reads a posting on Craigslist. “I may be of assistance.”The California legislature's been unable to agree on budget cuts and tax hikes needed to close a $24 billion budget gap leaving the state short of cash. Last week California issued registered warrants (a fancy term for IOUs) totaling $53 million the Financial Times reports.The IOUs are scheduled to be paid on or before October 2. Each pays an annual rate of 3.75% ...

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