(Bloomberg) -- When California sells taxable bonds
to foreigners, Moody's Investors Service says the state's credit
is Aaa, the highest possible. When the state sells tax-free debt
to U.S. citizens, its creditworthiness is four levels lower.
The discrepancy may cost taxpayers as much as $3.6 billion
in extra interest on bonds sold during 2006, said Matt Fabian,
an analyst at Municipal Market Advisors, a research firm in
Concord, Massachusetts. New York-based Moody's doesn't allow
towns and cities to apply the higher rankings to tax-exempt
financings that make up 90 percent of the $2.4 trillion in
outstanding municipal bonds.
Read more at Bloomberg Bonds News
to foreigners, Moody's Investors Service says the state's credit
is Aaa, the highest possible. When the state sells tax-free debt
to U.S. citizens, its creditworthiness is four levels lower.
The discrepancy may cost taxpayers as much as $3.6 billion
in extra interest on bonds sold during 2006, said Matt Fabian,
an analyst at Municipal Market Advisors, a research firm in
Concord, Massachusetts. New York-based Moody's doesn't allow
towns and cities to apply the higher rankings to tax-exempt
financings that make up 90 percent of the $2.4 trillion in
outstanding municipal bonds.
Read more at Bloomberg Bonds News
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