The US state of California, formerly the 7th largest economy in the world began issuing IOU ("I Owe You") certificates to people and businesses that they couldn't pay because they didn't have enough money. The IOU's are technically registered warrants meaning that they are convertible to legal tender.
Here's the irony: Let's say you were a contractor and did some construction work on state owned building. The state government will give you a registered warrant (IOU) that means they will pay you at a later date. However, if you hold CA Registered Warrants and want to use them pay any bill you owe to the state like taxes, licenses or workers compensation insurance, California will not accept their own warrants in return.
Don't believe me? search their own site: http://www.ca.gov/
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