Full faith and credit

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Full Faith and Credit

A situation in which a government agrees to repay a debt no matter what. For example, if a bond is backed by the full faith and credit of the United States, the U.S. government must find some way to repay the bond. U.S. Treasury securities, Ginnie Mae bonds, and some other debt securities are call full-faith-and-credit bonds because they have this backing. Municipalities may also attach full faith and credit to their bonds, but this means less than the credit of the United States.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

Full faith and credit.

Federal and municipal governments can promise repayment of debt securities they issue because they can raise money through taxes, borrowing, and other sources of revenue. That power is described as full faith and credit.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.
References in periodicals archive ?
Three other judges in Breavington suggested that the full faith and credit clause in s 118 of the Constitution (and wider inferences from the Constitution as a whole) had the effect of displacing the common law choice of law rules.
(56) Specifically, the choice of law rule for interstate torts was pronounced to be the law of the place of the wrong (without exception) and adoption of this rule was said to be strongly supported by constitutional principles such as full faith and credit and the nature of the federal compact including the 'predominantly territorial concern [s]' of the states and territories.
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There is an additional aspect of the Full Faith and Credit Clause that would protect states from being constitutionally forced to give legal effect to homosexual unions contracted in other states.
Finally, understanding the Constitution, including the intended purposes and limitations of the Full Faith and Credit Clause, removes the fear that the Full Faith and Credit Clause can be used legitimately as a tool for making homosexual "marriage" the law of the land.
During the infancy of the Full Faith and Credit Clause, there was considerable debate about how to interpret the Clause and its implementing act, focusing primarily on whether they were intended to be discretionary or self-executing.(41) Because courts had interpreted "full faith and credit," as used in the Articles of Confederation, to be an evidentiary rule, they initially adopted this interpretation when applying the constitutional provision.(42) The Supreme Court finally resolved the debate in Mills v.
Judgments, in contrast, have been accorded much greater deference and are entitled to the most stringent full faith and credit requirements.(48) Circumspection regarding judgments dates back to the Constitutional Convention, when James Madison "wished the Legislature might be authorized to provide for the execution of judgments in other States."(49) The rationale for this policy has been largely predicated on the doctrine of res judicata, which precludes a collateral attack on a judgment or an issue decided therein once fully litigated.
In addition to the Congress's self-imposed restraint regarding the full faith and credit clause, the states themselves have not always followed its provisions or accompanying legislation.
Supreme Court has determined that "a rigid and literal enforcement of the Full Faith and Credit clause for 'acts' [and other state actions] would lead to the absurd result that, whenever a conflict arises, the statute of each state must be enforced in the courts of the other, but cannot in its own."(37) The Court has used a variety of standards to evaluate the extent of the full faith and credit clause.
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