Illinois' bonds heading toward junk rating

Man pulling out pockets

Moody's Investors Service has lowered its rating on Illinois' general obligation bonds to A1 from Aa3. If doesn't interest you, you should know that it will eventually cost you money--indirectly for sure, but nonetheless you'll be hearing from the state once again about its serious financial troubles.

A lower bond rating means that Illinois will have to pay more to borrow money. Because Gov. Pat Quinn and the Legislature appear to be relying on ever more borrowing to "balance" the budget, higher interests rates will mean one of two things (or both): 1. There will be less money to spend on social services, education and other "critical" state programs. 2. Taxes will have to be raised to cover the higher interest payments.
With the ratings reduction, Illinois bonds are  on the threshold of being classified as lower medium grade, and ever more closer to a disastrous rating of non-investment grade and speculative. At that point, budget deficits will be hitting the fan.

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  • Thanks to all the great slug infecting our political offices. These pirates have finally gotten us to the brink of disaster.Thanks to you we will see a definite steady rise in taxes for years to come.Vote them all out.At least start with the Napolian of Illinois,mike madigan.Hooray for the democRATS............

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