Schwarzenegger Already Forced To Call Emergency Budget Session, And California Muni Funds Dive

What, you thought when California got its budget called, that that had actually solved anything?

Ha. They just kicked the can down the road: barely.


California Governor Arnold Schwarzenegger said on Thursday he will call a special session of the state legislature on December 6 to tackle the budget deficit, newly estimated at more than $25 billion through the next fiscal year.  Schwarzenegger said he would offer a plan including budget cuts, but Assembly Speaker John Perez rebuffed Republican Schwarzenegger and said he prefers to work on budget matters with incoming Governor Jerry Brown, a fellow Democrat who takes office in January.


Meanwhile, California muni bond funds are tanking.

Chart via Barry Ritholtz (this is the nightmare scenario that Meredith Whitney has been warning about):


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