Fed Official Hints Many Cities To Follow Detroit Bankruptcy Road – 15 April 2015

RT logoA top Federal Reserve official indicated Tuesday that the municipal bankruptcies of Detroit, Michigan, and Stockton, California, could mean further such filings in the future, more so that current bond ratings suggest.

At a workshop on the US bankruptcy code for local governments, or Chapter 9, New York Fed President William Dudley spoke of the possibility for more US cities to fall into bankruptcy before long.

“While these particular bankruptcy filings have captured a considerable amount of attention, and rightly so, they may foreshadow more widespread problems than what might be implied by current bond ratings,” Dudley said, according to a text of his speech.

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