Euro "Contagion" Spreads - Connecticut Takes a Ratings Hit

Oh how the mighty have fallen -

Connecticut is preparing to borrow $956 million to close a budget gap in the fiscal year beginning July 1, after borrowing money last year to cover a deficit of $947.6 million. Not good. Fitch has reduced the states credit rating from AA+ to AA.

“The downgrade reflects the state’s reduced financial flexibility, illustrated by its reliance on sizable debt issuances during the current biennium to close operating gaps in the context of already high liabilities,” Fitch said.

Connecticut is the wealthiest state on a per capita basis with personal income of $54,397 in 2009, according to Department of Commerce. 

 The Real Effect
Remember this?

Look for default to begin causing defaults across the globe as this crescendos into a global sell off.

Or this?

Look for States to get desperate as the lines get drawn in the sand. With increased pressure on the States to balance their budgets (Oh the horror!) and the plebs being instructed to make double the bricks with less straw, the US starts to resemble the situations over in Europe more and more.

 Remember, this is how things started with Greece and the officials told them it was "all fine".