There goes the California windfall in taxes

To that end, several economic indicators show California continues to languish under high unemployment and that business is now turning down. In a note to clients, Brian Sozzi, and equity research analyst at Wall Street Strategies Inc., pointed out that in a recent conference call Office Depot said its sales weakness in California has resurfaced. Real Time Economics

The smoke and mirrors budget at least realized the potential and localities were told to revisit the budget in six months. The Midatlantic and Pacific government seem to ping pong, and I would expect the debt ceiling crisis to hit the Midatlantic again before the year is out.
The bankruptcy bubble is floating around, deciding which regional government to clobber first.