We sold California short months ago, but perhaps we were a little to hasty. We would have bet the rest of our Hyatt Gold Passport Points that their $4 billion bond sale was doomed after nine months of being shut out of the credit markets all together and being downgraded to the lowest credit rating any state in the Union has to offer. That would have totally ruled out our trip to Lake Tahoe (off peak, you know) because Cali managed to suck in over $6.5 billion instead. We think, however, we know why:
Of the $6.54 billion, California sold $3.2 billion to individual investors.
An effective 9% yield may also have pulled shell shocked Cali denizens out the door (along with the blitz of an advertising campaign).
California Ends Bond Sale [The Wall Street Journal]