As the municipal market continues to digest - and decipher the implications of - Detroit’s Chapter 9 bankruptcy filing, San Bernardino has been awarded bankruptcy protection by a federal judge. The ruling comes a little over a year after San Bernardino filed an...
Month: August 2013
More Headline Risk for Munis
Market Outlook The potential U.S. strike against Syria has done what two weeks of Egyptian political turmoil failed to accomplish: bring the flight-to-quality bid back to the Treasury market. After testing two-year highs last week, the yields on the 10-year and...
The Bob Filner Effect in Munis
Market Outlook Yesterday’s three hour trading glitch at the NASDAQ provided the markets with a welcome respite from their obsessive Fed-watching behavior. The minutes of the FOMC released on Wednesday failed to provide further clarity as to the eventual timing of...
Less is More: Lessons Learned from Detroit Bankruptcy’s Unfunded Pension Battles
Participants in the Detroit bankruptcy are presently considering the legal and metaphysical question of whether a state constitutional provision can mandate that, unlike other contracts, unfunded pension obligations must be paid in a municipal bankruptcy without any impairment or reduction. Unfortunately, bankruptcy is the land of broken promises and impaired contracts but, regardless of the outcome of the legal debate, there may be practical answers emanating from the case for all those who are watching Detroit.
All Eyes on Detroit: What Happens to Unfunded Pension Liabilities When a Municipality Files for Bankruptcy?
While Detroit’s recent Chapter 9 municipal bankruptcy filing has certainly posed a variety of challenges for the City’s citizens and creditors, it may also serve a greater social benefit. Participants in the Detroit bankruptcy are presently considering the legal and...
A Look at Bond Insurers’ Exposure to Muni Credit Trouble Spots
Which bond insurance companies carry the greatest exposure to municipal credits that have been making recent headlines … Puerto Rico, Detroit, Chicago
More Budget Voodoo from Puerto Rico?
Market Outlook Global financial markets are starting to get cold feet as the start of Fed tapering efforts draws near. It certainly doesn’t help that recent economic data have been quite firm. Housing starts, for instance, have yet to be affected by higher interest...
Odd-Lot Muni Traders Get Some Love
Market Outlook After last week’s relatively subdued activity level, the Treasury market is gearing up once again for a slew of key economic releases this week. If the recent strength of the dollar is any indication, the market is looking for much firmer economic...
Can Muni Investors Still Rely on the Unlimited Tax G.O. Pledge?
Market Outlook The dog days of summer are upon us and the Treasury market appears to be stuck in a five basis points or so trading range after this week’s relatively uneventful auction. The benchmark 10-year and 30-year yields closed at 2.59% and 3.67% last night. In...
A Bounty of Relative Values on this Week’s New Issue Calendar
This week’s $8 billion new issue calendar will have a little something for everybody. Of course, the issue most likely to capture the market’s attention this week will be the $600 million Puerto Rico Electric & Power Authority (PREPA) deal.