It funds public borrowing, issues bank notes, and manages the country's gold and foreign-exchange reserves.
Unless they go all the way and cap their own ability to borrow, issuing long-term bonds makes no sense, and New York will continue to lurch from one budget crisis to the next.
The restructuring also depends on a deal to lease some city parking garages to an outside vendor and have a new state borrowing authority issue new debt to replace existing parking-authority debt.
The government borrowing figures, issued separately, are subject to revision.
That, I'd argue, is what the financial industry has been doing for a long time: borrowing by issuing supposedly safe assets, investing the proceeds in assets that don't really yield more, but seem to.(Paul Krugman Matt Yglesiass links to an intriguing new NBER paper on household leverage and the American recession.
* A plan to end the state's annual spring borrowing by issuing long-term bonds to pay off the state's deficit.
Indeed, to make his program work he will be forced to cut benefits well below current guarantees, raise taxes or borrow, an issue he refuses to confront.
While the national government can borrow and issue bonds for operating expenses — last year the budget deficit was about $207 billion, and it is optimistically forecast at $124 billion this year — local governments cannot.
When that money ran out, he started simply borrowing money, issuing bonds to keep the government operating, a gimmick so egregious that the state's Supreme Court later declared it unconstitutional.
It has also started a renminbi-denominated borrowing program, issuing a 3 billion yuan ($450 million) bond.
