“Detroit went bankrupt, but so what? Its own decades-long gross political mismanagement, corruption and incompetence pushed the city over the cliff into bankruptcy. Why should we care? The largest Chapter 9 filing in U.S. history will reverberate well beyond this once- bustling city and its creditors. What’s most threatening to muni bond investors, and in fact all investors, is whether the city’s general obligation bonds are secured or unsecured issues. General obligation bonds, backed by a city’s ability to levy taxes to pay interest and principal, are thought to be the safest of all munis. Detroit is putting this to the test.”
http://moneymorning.com/2013/08/02/this-could-shake-muni-bonds-to-the-core/
Related posts:
Benghazi: Who Cares?
Martyrs to the Cause: Carter Page and Julian Assange
Sequester solved: Sell national parks, stop foreign aid, leave Germany
A Fiscal Lesson in Cyprus for Americans
Civil liberties may not survive the 'Gorgon Stare'
U.S. Has No Moral Standing to Condemn Assad
Government Tattoo Statists of America
How Do You Like Your Central Planners, Bookish or Flamboyant?
Noninterventionism Is the Only Cure for America’s Foreign Policy Woes
John Kerry and the Orwellian Language of War
Cuba Denuclearized in 1962. Why Continue the Embargo?
Dead Souls of a Cultural Revolution
What You Don't Know About Immigration Can Hurt You
Brandon Raub and the Thought Police
Crisis and Opportunity in the Junior Miners