California downgraded by S&P, weighing on state's bonds

[DJ13]

Jan. 13, 2010, 3:48 p.m. EST

NEW YORK (MarketWatch) -- Standard & Poor's said Wednesday it downgraded California's credit rating to A-minus as the state faces another multi-billion-dollar budget gap for the current fiscal year and has appealed to federal lawmakers for assistance.

The cost of buying insurance against the risk California's government would default on its debt rose after the downgrade, but not by much, indicating many investors were well aware of the state's financial woes.

S&P maintained its negative outlook on the states $63.9 billion in general obligation debt, indicating more downgrades are possible.

The state's previous rating was A, already the lowest in the nation, an S&P spokeswoman said. S&P last downgraded California last February.

http://www.marketwatch.com/story/california-downgraded-by-sp-bonds-fall-2010-01-13

[Ignis]

1. I'm sure this will shame the (R)s in our legislature, right?

Nah, who am I kidding?