City bankruptcies may signal trouble for California - Sacramento Bee: "Rio Vista and Isleton face budget shortfalls and massive debt. Their leaders are looking at the same bankruptcy option that Vallejo chose in May.
If other cities follow suit, it may mean trouble across the state.
'The more that start talking about it, the more that start filing, investors will stop investing in municipal securities,' unless governments are willing to pay more in interest, said Matthew Fong, former state treasurer who oversaw California's finances in the wake of Orange County filing for bankruptcy protection in late 1994."
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Slippery slope?
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