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Michigan; General Obligation Dec 07
Standard & Poors, December 2007
The 'AA-' rating on Michigan's GO debt reflects: An economic base that is diversifying, but also weathering a sustained downturn resulting partly from a dependence on auto manufacturing; Good budget management that has allowed the state to effectively operate on thin margins resulting from low liquidity; and A low debt and pension burden with manageable carrying charges. The state's GO rating was lowered to 'AA-' on May 22, 2007, reflecting additional revenue shortfalls driven by ongoing economic weakness and a lack of timely progress in resolving both the 2007 and 2008 fiscal deficits in a structurally balanced manner. As expected, the fiscal 2007 gap was generally filled with onetime measures, leaving fiscal 2008 as the year to pay the piper....
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