California's Brown Backs Fiscal Restraint Cheered by Wall Street
- With reserves swelling, state eyes potential risks ahead
- Backed by financial turnaround, bonds trade near AAA yields
Jerry Brown
Photographer: David Paul Morris/BloombergThis article is for subscribers only.
California is raking in cash from surging stocks and is sitting on billions in reserves. Governor Jerry Brown is resisting the urge to spend it all, keeping with the fiscal restraint that’s won applause from Wall Street.
The Democrat’s proposed budget for the next fiscal year, released Wednesday, holds spending in line with the pace of revenue growth for the biggest U.S. state as the stock market hovers at record highs and its economy faces potential fallout from the federal tax overhaul enacted last month. It boosts the rainy day fund to $13.5 billion with a supplemental transfer of $3.5 billion.