School Bonds Could Trigger Fiscal Shock

“A decade ago, San Diego county in California was at the cutting edge of some dangerous financial games.

As the housing boom got under way, bankers and mortgage brokers became adept at flogging subprime loans to households across the area using “innovative” structures. That episode, of course, ended in tears, not just in San Diego but elsewhere in America.

Now, some new financial games have come to light involving a dangerous cocktail of innovation and debt. This time, it is not private households involved but public sector bodies – specifically, schools.”

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