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"The nation's subprime-mortgage crisis is prompting Florida cities, counties and agencies to pull billions of dollars out of a state-run investment fund.

They fear they could have lost their money because a state agency invested it in funds backed by loans to homeowners with questionable credit -- the same loans that have triggered an international credit crunch.

Governments and agencies typically take money intended to pay for such basics as teacher salaries or road repairs and invest it in the short-term state fund so they earn interest before the bills come due."

Here's where we are headed. The toxic waste is everywhere. I'm not kidding. Got to love Gov. Crist's response, which was basically, "Don't worry we'll bail you out."

Since Greenspan we've all become accustomed to bailouts. Seems like everyone gets bailed out. We have socialized risk. Meanwhile the profits are usually private. At some point this all becomes too big to bailout. Can we really bailout everyone at the same time? Who is going to bailout our government? China?

It's all one trade. The equity markets are at that same point, where we assume the bailout is coming to save us. The Fed will cut and save us. It always works right? Well I fail to see how problems that were created by easy money will be fixed by more easy money. Anyway here are the articles:

http://www.orlandosentinel.com/news/local/state/orl-bk-statefund112907,0,5698387.story?coll=orl_tab01_layout

http://www.orlandosentinel.com/news/local/state/orl-run2907nov29,0,138068.story