Stockton files for bankruptcy

Associated Press
Guillermo and Betty Garcia stand in their downtown Stockton, Calif., clock and jewelry shop Wednesday, June 27, 2012. Garcia said the Stockton bankruptcy will have a trickle effect on residents and business owners, including a rise in crime and more businesses going belly up. (AP Photo/Gosia Wozniacka)

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Stockton, California, became the largest city to file for bankruptcy in U.S. history on Thursday, June 28, after years of fiscal mismanagement and a housing market crash left it unable to pay its workers, pensioners and bondholders.

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