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February 27, 2009 - 01:36 pm
News Feed: Massachusetts
Looming financial apocalypse at the Pike
By David, Blue Mass GroupThe details are mind-numbingly complicated, but it turns out that, due to a brewing perfect storm of factors, the Turnpike Authority may soon find itself on the hook for a loan payment of nearly $400 million. Needless to say, it doesn't have that kind of cash lying around, so the question of whether the state needs to step in to guarantee the Pike's massive debt (thereby hopefully staving off the giant payout) was discussed at a Senate hearing yesterday.
The deal involves mysterious instruments called "swaptions," as well as a bond insurer called Ambac whose share price is currently under a dollar, our bankrupt friends at Lehman Brothers, and the
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