Market Commentaries

Some perspective on the recent California bankruptcies

July 2012

There have been three municipalities that have either filed or have voted to approve filing bankruptcy in California in the past year: Stockton, Mammoth Lakes and most recently, San Bernardino. Stockton and San Bernardino went bankrupt due to the “usua …


Municipal Bondholders 1, Jefferson County Newspeak 0

June 2012

Score one for bondholders. A federal judge ruled in June that Jefferson County, Alabama could not reduce debt payments while in bankruptcy in order to spend more of the system’s net operating revenues on its aging sewage system. County’s Orwe …


Treasuries Continue to Rally, Municipal Bonds Less Affected

May 2012

Renewed questions as to the health of the European Economic Union coupled with news of slowing growth in China, India and here at home sparked a strong rally in the Treasury market this past month. Treasuries rally more pronounced While this …


“Intercalary” February: An Extra Day of Bond News

February 2012

Leap Year means 29 days in February 2012, so there is an extra day of bond news this month.New issue supply remained modest, demand strongThe new issue supply of municipal bonds remained fairly modest in February and investor demand remained strong dur …


Back To Municipal Bond Basics

January 2012

“You could see 50 sizable defaults, 50 to 100 sizable defaults, more. This will amount to hundreds of billions of dollars worth of defaults.” – “60 Minutes”, Meredith Whitney commentary, December 2010   “The notion that many bond investors have th …


Municipal Market Minefield Maneuvering in Perspective

January 2012

Last month I was invited to participate in an hour-long discussion hosted and aired live by InvestmentNews, Muni Markets: Maneuvering Through the Minefield. The content was wide-ranging and lively. Over the past few years, we have written about a numbe …


Bond Rally Continues

January 2012

The bond market’s powerful December rally continued unabated into the first month of the year. Bond yields declined to near historic lows in both the U.S. Treasury and municipal bond sectors. The 10-year Treasury yield fell to 1.80% on January 31st ver …


Widest Municipal Yield Spread in Two Years, Bankruptcy Update

November 2011

Municipal bond prices held up surprisingly well during the month, despite an increased supply of new municipal bond issues following months of low issuance.Municipal yield spread against Treasuries widest in two yearsThe 10 year, “A” rated MMD Index bo …


Municipal Market Progresses Unevenly

October 2011

The municipal bond market showed more signs of progress in October, albeit unevenly – a persistent market narrative that creates opportunities for the disciplined and informed.State revenues growing despite property tax declinesThe macro economic pictu …


Yield Search Favors Municipal Market

September 2011

After August outflows, the municipal bond market turned bullish once again in September with four weeks in a row of bond fund inflows – and the last week more than doubling the inflows of the previous week. The month also saw a couple of true superlati …


The Effect of a U.S. Rating Downgrade

September 2011

After August outflows, the municipal bond market turned bullish once again in September with four weeks in a row of bond fund inflows – and the last week more than doubling the inflows of the previous week. The month also saw a couple of true superlati …


U.S. Downgrade Domino Threat

August 2011

The prevailing August municipal bond market story was the threat posed by the U.S. rating downgrade. The improving state tax situation and the search for better yields also led municipal bond market news in the past month.Wholesale municipal rating dow …


Mid-Year Municipal Credit Update

July 2011

In this commentary, we will summarize where municipal credit quality has been, where we believe it is today, and what our clients should expect over the near term investment horizon. The municipal market began the year with a tumultuous first quarter, …


The End Is Near

May 2011

What Will it Mean to Municipal Bonds in 2011 and Beyond? As the economy expands, it is becoming clearer that we are nearing the end of the “easy money” policy that the Federal Reserve has pursued over the past few years. So what can we expect once the …


Calmer, Bullish Municipal Market: Opportunities Amongst Problems

May 2011

Municipal bond prices continued their upward move during May resulting in lower yields across the maturity spectrum at month end. A calmer tone to our marketplace has set in over the past two months as much of the selling hysteria earlier in the year h …