New Jersey Pays Goldman Sachs to Protect Non-Existent Bonds
New Jerseyites worried about where their tax dollars are going can rest assured that it’s to a worthy cause: Goldman Sachs. Bloomberg details a program under which residents of the financially strapped state are paying a partnership run by the investment bank nearly $1 million a month to guard against rising interest costs on auction-rate debt. The best part is that the bonds were redeemed more than a year ago. That’s right — the paper is history. The most-densely populated U.S. state is making the payments under an agreement made during the administration of former Governor James E. McGreevey in 2003, when New Jersey’s Transportation Trust Fund Authority sold $345 million in auction-rate bonds whose yields fluctuated with short-term interest…
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