U.S. banks poured more than $200 billion into state and local-government debt since the onset of the financial crisis six years ago, boosting their share of the $3.7 trillion market to a two-decade high.
Only eight months ago, Bill Lockyer was the envy of California politicians. Undefeated in 39 years as assemblyman, senate leader, attorney general and treasurer, the Democrat won 5.4 million votes in his 2010 re-election, more than any other state official in the U.S.
California Treasurer Bill Lockyer, who never realized his ambition of governing the most-populous state, may remain a powerbroker after leaving office with $2.5 million in campaign funds and four decades in politics.
California plans to sell $12.5 billion in debt in the next 18 months after the most-populous state’s economic recovery helped reduce its relative borrowing costs to the lowest level in five years, Treasurer Bill Lockyer said.
Servicing California’s general-fund debt will take a smaller chunk of the state budget -- 7.7 percent -- this fiscal year compared with the 9.8 percent estimated in 2009 by Treasurer Bill Lockyer, who cited lower interest rates.
Morgan Stanley and Citigroup Inc., criticized by California for arranging investment bets against state bonds, pitched Treasurer Bill Lockyer on ideas for legislation to sell $25 “minibonds” to expand sales to individuals, records from his office show.