Bloomberg is reporting:
"The advisers for Alabama's most-populous county were in Washington to keep federal officials informed of its negotiations with creditors, U.S. Representative Spencer Bachus said."
I guess we can all relax now because as the Bush administration said the mortgage crisis is contained. It appears it more like a Southern Cali fire with 50mph Santa Anna winds. Now whole counties are being affected by higher borrowing cost related to banks trying to recoup their sub-prime loses. Wow. These people are creative and are always looking to transfer wealth from the middle class to the rich.
"Jefferson County, home to Birmingham, is reeling from interest rates on variable-rate bonds that jumped as high as 10 percent when the auction-rate securities market collapsed and the county's bonds, backed by ailing insurers FGIC Corp. and XL Capital Assurance, were shunned by investors. Without restructuring its bonds, interest costs on its sewer debt may reach $250 million, nearly twice the $138 million the system produces in revenue, according to county Commissioner Bettye Fine Collins."
The quest then must be asked! Does your municipality taken out variable-rate bonds that are jumping? What will that do to your taxes?