Schwarzenegger signs law allowing bond buyback

SAN FRANCISCO (Reuters) - California Gov. Arnold Schwarzenegger signed a bill on Wednesday that would allow government entities to buy back certain bonds during interest rate spikes.

"This measure will protect taxpayers from further financial harm by helping governmental entities buy back these bonds and resell them when market conditions are more favorable," State Treasurer Bill Lockyer said in a statement.

(Reporting by Adam Tanner; Editing by Gary Hill)