For the past 18 months the state has been unable to use $1 billion it sank into supposedly highly liquid, short-term investments because of a collapse in trading of the securities. No one knows for certain when the state will get its money out of so-called auction-rate securities, and an auditor recently required the state to revalue its holdings at $114 million less than what it paid for the investments.
--Honolulu Advertiser
The administrator of the Financial Services Division, Scott Kami, says there is still more than enough money for projects and the state's bills. It's very disturbing that the state invested a total of $4.5 billion, $1.1 of which was invested in these "auction-rate" securities. That's nearly one-fourth of all investments.
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