People are actually thinking that the state of California will be able to make good on the IOUs, so there are willing buyers out there offering money for the bonds, which gain 3.75% interest on Oct 2.
Interesting use of arbitrage, but will Cahl-ee-forr-nee-a actually be able to come up with the money to pay for its IOUs? Doubtful.
“I’m looking for a smallish California IOU – $100 or less – for souvenir purposes. I have a notary available and am willing to pay 110 percent of face value.”
“What’s top dollar.I have a little over $10k comming.Some shark posted he’ll 85 cents on the dollar”
"well isnt that nice of you to offer a whole .75 cents on the dollar. Nice when trash like you comes out to take advantage of people. I hope no one repsonds to you. Asshole "