Stockton files for bankruptcy

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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