The banks got in trouble by giving credit to people who were not creditworthy. It is not clear that California is creditworthy at this point, and they are only

The banks got in trouble by giving credit to people who were not creditworthy. It is not clear that California is creditworthy at this point, and they are only offering a 3.75% coupon. These bonds mature in three months. In order to believe that these are as good as cash, you have to believe that there is a 99% chance that California will be good for the money. That is clearly unreasonable given what has happened with the budget so far.