In this video Diane Garnick an investment strategist at Invesco discusses the looming bailout for state and local governments. Nearly every state and local government has seen a dramatic drop in their revenue. Unlike the federal government state and local governments aren’t able to print money to pay their debts.
The state that’s being hardest hit by the revenue crisis is California which receives nearly 75% of its revenue from corporate income tax, personal income tax and sales tax. These three revenue streams are adversely affected by an economic downturn.
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