Get out of municipal bonds
04-09-2009, 04:29 PM
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Get out of municipal bonds
I saw a thread where someone said municipal bonds is a good idea.
Not so fast ....
U.S. Local Governments Get Moody’s Negative Outlook (Update2) - Bloomberg.com
Not so fast ....
U.S. Local Governments Get Moody’s Negative Outlook (Update2) - Bloomberg.com
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04-09-2009, 06:47 PM
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The headline seems much more ominous than the supporting details of the article suggest. Unlike a business, a government will still take in money when the people aren't willing to freely give it. Insolvency is also not a problem when you are able to continue to operate from a fiscal deficit position. Bond obligations are funded before capital expenditures as well, so they are far safer than commercial stock based funds.
Definitely an interesting article.
Definitely an interesting article.
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