Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
You know all you had to say was hey Mike, MUB has actually been trading for a few years now and corrected me, instead of acting like a Dick...
But thats ok I'm the immature one...
Yep I've never read a 10Q in my whole life either...
I'm so impressed with your ultimate wisdom, I'm a daytrader, I'm not going to read the 10Q on every stock I daytrade but that sure as hell does not mean I never read a Q report or 10K for that matter...
Not sure why your being such an Ahole, all I can say is put me on ignore and then you on't have to watse your precious time reading my useless posts...
Yep thanks for pointing out that colossal mistake that MUB has been trading for 4 years and not 1, that could have been a catastrophe for some of my zombie followers, way to go Master DD'er!
Yep I only watch CNBC for DD, I never read or post anything but CNBC DD, cause I'm a Monkey...
The question is why are you reading my posts or following a board that I started? Since I'm soo useless and all...
Maybe I'll go with your plan of posting once every week, having 5 people follow you is cool...
Thanks Ahole...
I swear the chart only went one year back when I first looked at it yesterday, hmm...
But thats cool Cyber Big mouth, I'm sure in person you'd never be man enough to speak like that to me...
Nov 2011 vainity fair. "California and bust"
http://www.vanityfair.com/business/features/2011/11/michael-lewis-201111
7 pages
I guess Meredith's prediction is not coming to fruition just yet, gonna let the board go for now...
As ta La Vista!
Central Falls, R.I., struggles to step back from financial abyss
July 11, 2011|By Erika Niedowski, Associated Pres
Major concessions are being sought from municipal workers of Central Falls,… (Elise Amendola/Associated Press)
CENTRAL FALLS, R.I. - At the community center, the subsidized lunch for seniors is no longer being served. The pool has been drained. Health screenings have been cancelled. The locks to the building were changed last week, and not even the acting director is allowed inside.
The public library has gone dark too, a sign on the door at the top of the stone steps telling patrons to return books elsewhere - indefinitely.
Central Falls, one of New England’s most distressed cities, is on the cusp of filing for bankruptcy protection - a relatively rare step for municipalities even in tough financial times. Since 1980, only about 46 cities or towns in the United States have sought such protection, according to James Spiotto, an attorney in Chicago who is an expert in municipal bankruptcies.
Last year, the state took over Central Falls - a city of 19,000 residents with an unadjusted unemployment rate of 15 percent - stripping the mayor of his keys to City Hall and the rest of his authority. That move came after every teacher was fired at the underperforming high school, with most of them rehired later.
As state officials try to dig Central Fall out of its financial hole, negotiations are ongoing with labor unions and retirees and cuts are being sought from every corner of the budget. Without major concessions, bankruptcy is a very real possibility. Bankruptcy can take a toll on a city’s reputation and put stress on neighboring communities, which might have to step in to provide services.
“It’s a difficult, painful, and wrenching process,’’ said Richard Levin, an attorney who has been advising the city council in Harrisburg, Pa., which has been flirting with bankruptcy because of more than $280 million in debt on its trash incinerator, several times the size of the city’s annual budget. “Some people think bankruptcy is like a bath or a free pass. That’s not it at all.’’
Orange County, Calif., a wealthy community south of Los Angeles, became the largest municipality in US history to declare bankruptcy in 1994 in large part because of risky investments.
Vallejo, near San Francisco, went the same route in 2008. The city is poised to emerge from bankruptcy protection after renegotiating costly union contracts and restructuring its debt.
Legislation allowing broke cities and towns to seek bankruptcy protection under what’s known as Chapter 9 was born of the Great Depression when, according to the National Bankruptcy Review Commission, more than 2,000 municipalities defaulted. Entire jurisdictions were swallowed up by others.
States cannot declare bankruptcy, but 13 permit municipal filings and another 11 do so with some conditions. The Rhode Island General Assembly, in response to the crisis in Central Falls, last year rushed to pass legislation allowing for a state receiver to step in.
The 1.3-square-mile city north of Providence, where 60 percent of the population is Hispanic, faces $80 million in unfunded pension and benefits obligations and an estimated $25 million in deficits over the next five years. Officials said it was hard hit by a loss in state aid and the fact that expected collections from the Wyatt Detention Facility never materialized.
Meredith Whitney says beware of July 1 -key date for Muni Market -- Fiscal Calendar for many states begin http://stk.ly/iRPVPH
Meredith Whitney: State finances are worse than estimated
By Shawn Tully, senior editor-at-largeJune 6, 2011: 1:44 PM ET
The outspoken municipal bond bear follows up with more evidence that the fiscal troubles in many states are far greater than we've been told.
FORTUNE -- Meredith Whitney is issuing a fresh warning to mutual funds, banks, and politicians: The state of state finances is far worse than what you think, or at least than what you've been willing to tell the investors and taxpayers who will eventually carry the burden. In a new report released today to her clients, Whitney summons what appears to be the most comprehensive set of data ever assembled on state budgets and debt.
Meredith Whitney, still focused on state finances.
Her conclusion is that the future deficits that need to be closed, either by new taxes or draconian cuts in social services, are far bigger than the official numbers show, and that debt levels, when all liabilities are counted, vastly exceed the official estimates.
Late last year on 60 Minutes, Whitney predicted hundreds of billions in defaults on municipal bonds in the next five years. That controversial call was widely condemned, especially on Wall Street, where the muni market is an enormous profit spinner.
Now, Whitney tells Fortune she never meant to make more than a general forecast. "I never intended on framing the scale of defaults as a precise estimate, but I continue to believe that degree of municipal defaults will be borne out over the cycle. I meant to point out that the state debt problem is a massive headwind for the U.S. economy, second in importance only to housing."
Whether you agree with it or not -- and she's still getting little support from rating agencies or anywhere else -- the numbers she's assembled, and the risks they pose, are daunting.
Whitney's latest report is even more thorough than last year's analysis that started the uproar. It covers 25 of the largest states, adding ten new ones to the list, including Arizona, Nevada, Connecticut, and Wisconsin. The problem starts with spending. Since 2003, state governments have raised annual outlays from $1.5 trillion to almost $2.2 trillion, or $700 billion, yet tax receipts have risen only $400 billion or $300 billion less, to $1.4 trillion. In fact, spending kept surging all during the recession, while income from sales, income and corporate taxes went totally flat in 2007.
Three big problems, no solution
But 46 states are obligated to balance their budgets each year. So how are they bringing receipts in line with spending when taxes fall 36% short of revenue? And remember, this gap is growing despite big tax increases that are becoming more and more difficult. The states are getting that extra money from three sources. First, the federal government enormously increased aid to the states under the stimulus or American Recovery and Reinvestment Act. Since 2009, the ARRA has delivered $480 billion in grants and contracts, padding over one-third of their combined deficits. But the last stimulus dollars expire this month.
Even with a historic increase in federal assistance, the states have relied on two additional measures to plug the remainder of the shortfall -- measures that will be harder and harder to repeat. The states tapped "rainy day" funds or surpluses reserved for emergencies. Their governments used $9 billion of that cash in 2010, with Connecticut totally exhausting its $1.4 billion in reserves, and Pennsylvania tapping its emergency savings for $755 million.
Second, the states have immensely increased their issuance of General Obligation bonds that fund what corporations strive to avoid -- paying operating expenses with long-term debt. Those securities are backed exclusively by state tax revenue. In 2000, the states issued $67 billion in GO securities; last year, they raised $148 billion from those bonds. While Whitney acknowledges that this class of securities is unlikely to see defaults, they still place a huge burden on the future. The reason: Fixed interest expenses are absorbing a bigger and bigger share of state budgets, leaving a shrinking portion for everything else.
Today, debt service absorbs half of Nevada's budget, and 40% of Michigan's. In Arizona, California, Connecticut, Ohio and Illinois, the share now exceeds 20%.
The third and biggest problem, pension costs, both increases current cash expenses and artificially understates what the states should be spending today. Even by putting the minimum into their pension funds, they're still crowding out spending for everything else because the costs are rising so fast. Hence, it ensures that future tax increases and spending cuts will be far greater than advertised. The states are systematically underfunding their pensions. Today, they cover 77% of their future liabilities versus 103% in 2000. If they fully paid their annual pension costs, the states would need to increase spending by over $700 billion a year, or over 40% of their current outlays.
And those figures don't include future spending on health care costs, falling into a little-known category called OPEB or Other Post Employment Benefits. Most states simply pay these OPEB costs directly from revenues. No actual income-generating funds, accumulated for the future, back them in most states. New Jersey, New York, Connecticut and Illinois are all pay-as-you go states with totally unfunded OPEB liabilities. As those costs inevitably swell, they will apply even more pressure to state budgets.
Giant shadow of debt
Whitney also presents a startlingly bleak picture of state debt. States have two types of liabilities that are fully backed by tax revenues. One is on-balance sheet, and the other is excluded from the states' books. The first type is the General Obligation bonds that fund salaries and current expenses. Those are fully visible to investors. But the bigger problem is the giant shadow cast by the pension and OPEB liabilities that are absent from balance sheets. In fact, states weren't even required to report the OPEB number at all until 2008, and the pension figure is consistently understated because states generally far overestimate future returns on their retirement funds.
As Whitney shows, these off-balance sheet numbers are an incredible three times the size of all on-balance sheet debt, totaling $2 trillion. The load is rising quickly; the unfunded pension burden has jumped 50% in the past year.
Naturally, some states are far healthier than others. Indiana, says Whitney, is a "model citizen," while California and New Jersey already face such high tax rates that they have little room, or political will, to raise more revenue. The danger is a continuation of what's already happening, what Whitney calls "state arbitrage," in which the low-tax, business friendly venues such as Texas and North Carolina keep drawing companies and workers from the fiscally-challenged states. That could cause a vicious cycle where the weak get even weaker as their tax bases erode, and the strong reap the rewards from fiscal prudence.
The damage from state arbitrage could increase the scale of defaults in the second type of municipal securities: Revenue Bonds. Once again, Whitney sees little threat to General Obligation bonds because states simply won't default. What the fiscal calamity calls in doubt is Revenue Bonds that back specific projects such as subsidized housing, toll roads, land acquisitions, and nursing homes. Those bonds are supported by the cash flows from the projects themselves, and they aren't guaranteed by the state governments. So if the cash flows fall short of the interest payments, they need to be restructured -- at a big cost to the investors who own them. And the revenue bonds now dwarf general bonds in total volume, totaling $2.7 trillion, versus $1.4 billion for the GOs.
Whitney points out that Florida has issued 90% of its municipal offerings in revenue bonds, many tied to real estate. Those real estate-related securities are the most vulnerable. Only time will tell if the "hundreds of billions" figure Whitney ventured on 60 Minutes will materialize. But her report shows that of all the problems investor and politicians are worried about, the mess in state finances is one of the most dangerous, and certainly the most overlooked.
Moody’s Lowers State’s Outlook
Wednesday, June 01, 2011
Moody’s Investors Service has revised the credit outlook for Rhode Island from stable to negative, citing the rising unfunded pension liability and the state’s inability to balance its budget without one-time fixes.
The state’s credit rating remained at Aa2.
“The negative outlook reflects the potential impact of rapidly escalating pension costs on the state's ability to increase its liquidity margins, diminish its reliance on one-time measures to balance its budget and reduce its debt burden,” Moody’s stated in a news release.
“The state's pension costs are set to double in two years by an amount that roughly offsets its budget reserve account, raising the likelihood that it will continue to face significant budgetary pressures and fail to achieve the fiscal breathing room needed to sustain a financial position commensurate with other Aa2-rated states.”
Key factor: pension fund
The Moody report highlighted the problems in the state pension fund, which has gone from an 84 percent funded ratio in 1999 to 61 percent in fiscal year 2009, even though the state had been making all of its annual required payments.
“Like other states, poor investment returns over the past decade and pension enrichments granted during flush times contributed to the persistent funding shortfall,” Moody’s said. “Several rounds of pension reforms, which included changes in accrual rates, retirement age, final average salary and cost of living adjustments, failed to result in significantly reduced liability.”
Moody’s noted that since General Treasurer Gina Raimondo took office, the state retirement board has adopted new assumptions about the rate of return, causing estimates of the pension liability to rise. As a result, the state retirement system is now 48 percent funded. Plus, between fiscal years 2010 and 2013, the annual cost of the system to the state budget will double.
U.S. States Pension Fund Deficits Widen by 26%, Pew Center Study Says
By William Selway - Apr 26, 2011 12:00 AM ET inShare6More
Business Exchange Buzz up! Digg Print Email U.S. states’ deficits in their employee retirement systems widened by 26 percent in fiscal 2009 as governments were stung by investment losses and failed to pay enough into their pension funds, a study found.
The deficits, or the difference between the retirement and health-care benefits states have promised their employees and the assets set aside to fund them, grew to $1.26 trillion by the end of the 2009 budget year from $1 trillion a year earlier, the Pew Center on the States said in a report released today. The fiscal year ends in June for all but four states.
The gaps are straining governments that have yet to fully recover from the recession and are stoking political fights in states such as New Jersey, Ohio and Wisconsin over the workers’ benefits. They have also drawn scrutiny in Congress, where Republicans have held hearings into the risks posed by underfunded pensions and backed legislation that would bar the federal government from bailing out any ailing funds.
“The states dug themselves a big hole before the recession ever hit,” Susan Urahn, the managing director of the Pew Center in Washington, said in a conference call with reporters yesterday. “We can see how the Great Recession and states’ severe budget problems made a serious problem even worse.”
The data from the 2009 fiscal year provide a snapshot of the pension funds during the worst of the financial crisis.
The median pension plan lost 19 percent that year, according to figures cited in the Pew report. The setback may continue to weigh on states that count on annual returns of about 8 percent and use accounting methods to spread their losses across years.
Long Legacy
In 2009, state retirement systems had 78 percent of what they needed to pay for promised pensions, according to the Pew Center, down from 84 percent a year before.
“Pension funding levels are stabilizing after the steep investment losses caused by the 2008 Wall Street collapse,” Urahn said. “But the legacy of the recession will be evident on pension-fund balance sheets for some time.”
The unfunded liability in state-run pension plans rose to $660 billion in 2009 from $452 billion a year earlier, according to the Pew Center’s figures, which rely on the funds’ expected rates of return to calculate long-term liability. That deficit projection would grow to $1.8 trillion under corporate-style accounting methods, which use lower expected returns.
Health-Care Bills
The states are also facing the rising cost of employee health care benefits that, unlike pensions, are largely financed as the bills come due. Such expenses accounted for $604 billion of the retirement systems’ deficits, according to the Pew Center’s report.
Those health-care obligations may squeeze large states if medical costs keep rising as baby boomers retire over the next decade, Urahn said.
“That annual bill is going to really rocket up,” she said.
The biggest unfunded pension liabilities in 2009 were in Illinois, which had just 51 percent of what it needed to pay for promised benefits, and West Virginia, with 56 percent, according to the report. New Hampshire was 58 percent funded, while New Jersey and Ohio both had just two-thirds of what they needed.
On the other end of the spectrum, the pension plans in New York and Wisconsin were fully funded.
Some states worsened their problems by not making full payments into their pension funds each year. Pennsylvania paid only 31 percent of its required contribution in 2009 and New Jersey 36 percent, according to the report. Both Wisconsin and New York made their full payments.
To contact the reporters on this story: William Selway in Washington at wselway@bloomberg.net
Gundlach on CNBC calling for 15-20% whack on Muni bonds...
http://online.barrons.com/article/SB50001424052970204442204576144662301971254.html
"No Way Out" of Debt Trap, Gross Says: U.S. Living Standards Doomed to Fall
Posted Mar 08, 2011 09:00am EST by Stacy Curtin
In the U.S., states across the country face a collective $125 billion shortfall for fiscal 2012, while Congress is facing a budget gap nearly 10 times that size.
PIMCO founder Bill Gross -- one of the world's largest mutual funds managers, who focuses mostly on bonds -- has previously said that if the United States were a corporation, no one in their right mind would lend us money. For the last decade, we’ve been “relying on the kindness of strangers” to help cover our debts, he tells Aaron Task in the accompanying clip.
By “strangers” he is referring to our foreign counterparts, like China for example. Basically, for years Americans have spent their hard-earned dollars on less-expensive Chinese made goods. With great gratitude, China turned around and used all those dollars to buy up U.S. Treasuries and other dollar-denominated assets.
But now after years of reckless spending, America’s debt level is nearing a breaking point and can no longer rely on foreign capital as a last resort. “When a country reaches a certain debt level, confidence in that country’s ability to repay that debt becomes jeopardized,” says Gross, citing the work of Ken Rogoff and Carmen Reinhart in This Time Is Different.
The Way Forward...And Your Pocketbook
The budget crisis situation unfolding - at the state and federal government level - does not bode well for working men and women in this country. There are really only two choices, says Gross. And, neither favors your pocketbook:
Option #1 – Keep spending and do nothing
Option #2 – Balance our budgets by cutting entitlements
House Republicans ran and won on a platform to cut $100 billion from the budget this year and last month managed to pass legislation that would strip $61 billion in spending.
But for President Obama and Congressional Democrats, those cuts go way too far at a time when the country is still struggling to recover from the worst recession since the Great Depression. Goldman Sachs and Bill Gross agree and have warned that cutting too much could stifle growth. (See: Gross "self sustaining" clip)
Meanwhile, neither side has gotten serious about reforming entitlement programs like Social Security and Medicare, which account for more than a third of Uncle Sam's budget.
If the country cannot come to grips and cut back on entitlement programs, U.S. debt will continue to grow and governments around the world will loose faith in the U.S. dollar. Foreign goods would become more expensive, says Gross, while our standard of living would drop.
Under the second option, if entitlement programs are cut, many Americans would naturally have to learn to live on less and take a hit to their standard of living.
“There is really no way out of this trap and this conundrum at this point,” says Gross. From an investment perspective his advice is to stay clear of “bonds in dollar denominated terms” and to be “wary of higher interest rates going forward.” (See: Gross "Most Overvalued" clip)
.
It Sounds Like George Soros Is Agreeing With Meredith Whitney On The Muni Problem
Courtney Comstock | Jan. 26, 2011, 11:28 AM
Billionaire hedge funder George Soros, speaking to Maria Baritoromo on CNBC, said today that the Muni bond crisis will be this year's big "drama."
Soros compares the muni situation to Europe, where local governments can't print their own money.
Of course, Meredith Whitney predicted a massive wave of muni defaults.
He also said that the Euro crisis is now in the process of being resolved, but that the euro has clearly had the opposite effect as intended with weaker countries coming down, and the strong getting stronger.
Now click here to see the 12 reasons Meredith Whitney is wrong about the Muni crisis >
Read more: http://www.businessinsider.com/george-soros-the-muni-crisis-will-be-the-drama-of-this-year-2011-1#ixzz1Chat7mU3
Indiana Bill Would Allow Cities to Declare Bankruptcy; Gary, Lake Station, Georgetown Likely Candidates; Hands Tied in Rhode Island
http://globaleconomicanalysis.blogspot.com/
Surge of money from bonds could stifle lending
A sudden shift in saving habits could spell trouble for borrowers as Americans exit bond funds
Matthew Craft, AP Business Writer, On Thursday December 23, 2010, 4:01 pm EST
NEW YORK (AP) -- Americans are leaving bond mutual funds at the fastest rate in more than two years.
U.S. investors pulled $8.6 billion out of bond funds in the week ended Dec. 15, the largest withdrawal since October 2008 when financial markets were in free-fall. They pulled an average of almost $3 billion every week since Nov. 23, according to the Investment Company Institute. Prior to November, money had been flowing into bond funds every week for nearly two years.
"This is the real deal," says Marilyn Cohen, founder of Envision Capital Management, which oversees $300 million in mostly fixed-income investments.
If she's right, the end of cheap credit is near. Interest rates would rise, which would ripple through the economy. It would become more expensive for cities, states and companies to borrow money to build schools, roads and expand their businesses. It would also cause the value of bond funds to fall, blindsiding Americans who thought they'd stashed their retirement savings in an investment that wouldn't sink.
Bond funds are creditors. They take cash from savers and lend it to corporations and governments in exchange for interest payments and promises that the cash will be returned at a certain date. If there's less money to lend, borrowers need to pay higher rates to coax funds to buy their bonds.
It follows the law of supply and demand. If there's less of something, it pushes the price up. In this case, if the stream of money running into bond funds dries up, the cities, states and corporations that rely on them for financing will wind up paying more to borrow.
That would hurt cash-strapped states like California and Illinois which can't afford higher debt payments. It also means that Wal-Mart Stores Inc., Johnson & Johnson and other corporations will no longer be able to borrow money at the cheapest rates on record. IBM Corp. sold $1.5 billion worth of bonds in August at a rate of just 1 percent.
With few exceptions, Americans have favored U.S. stocks over bonds since the early 1990s. The housing bust broke that habit. U.S. stock funds began bleeding cash in 2007 and bond funds began piling it up.
That shift intensified during the financial crisis as people sought safer investments and bond funds began posting stronger returns. Banks and foreign governments made U.S. bonds a favored hiding spot during the financial crisis, knocking the yield on the 10-year Treasury note down to nearly 2 percent. The yield had been above 5 percent in June and July of 2007, before the onset of the Great Recession in December of that year.
The embrace of fixed-income funds throughout the recession had many benefits, says Hans Mikkelsen, credit strategist at Bank of America-Merrill Lynch. The record $376 billion that flowed into the bond market in 2009 allowed corporations to refinance their debt at cheaper rates. Without it, Mikkelsen says, many companies would have defaulted.
"It should have been the worst run of defaults we've ever seen, but instead it ended up being the shortest," Mikkelsen said.
Just as their safe and steady performance drew investors to bond funds, the recent rout in debt markets is scaring them away. In four of the past five weeks, Americans have yanked more money from bond funds than they invested, the only weeks this year that has happened.
Nicholas Colas, chief market strategist at BNY ConvergEx, regularly checks the data tracking investment flows for any surprises. Watching the slow, steady drip of cash into them became tedious after a while.
"Now it's like when you see a car crash," he says. "First you look and think, 'Did that really happen?' And then you check to see if everything is OK."
Even the world's largest mutual fund has lost some appeal. Pimco's $256 billion Total Return Fund, run by bond market guru Bill Gross, returned just 1 percent a month on average until November, according to Morningstar data. That month the bond fund lost 1.4 percent, its worst performance since September 2008. Investors pulled $1.9 billion from the fund in November, the first net withdrawal in two years.
What spurred the change? It started with a sharp drop in Treasury prices in mid-November, which drove long-term interest rates up from near-record lows. That sent borrowing costs higher across the board because all U.S. debt markets take their cue from the Treasury market.
Treasury prices had been climbing since late August on hopes that a major bond-buying program by the Federal Reserve would prevent long-term interest rates from rising. But then a number of economic reports started to raise hopes that the economy was strengthening. That led investors to start pulling money out of Treasurys.
The big blow came after President Barack Obama announced a compromise with Senate Republicans to extend tax cuts for two years and unemployment benefits for another year. Economists raised their forecasts for economic growth, and bond traders began bracing for even wider federal budget deficits. Both spell trouble for bonds. The tax package, signed into law last Friday, is expected to cost $858 billion.
"All that talk from Washington about wanting to keep budgets tight just went out the window," Colas said.
The real danger, analysts say, is if the selling starts to feed on itself, creating a steep jump in long-term interest rates. Investors ditch bonds, pressing prices down and causing more investors to flee. "Selling begets more selling," Cohen says. "The psychology of greed and fear never changes."
Under the worst-case scenario, long-term rates shoot higher and derail the recovery. If they rise gradually without choking off economic growth, some think the money flowing out of bond funds will find its way into stocks. That hasn't happened yet. U.S. stock funds are still seeing an average $2.3 billion in net withdrawals a week.
Stock funds have two important trends running in their favor.
-- Stocks became less volatile right after the bond market started to weaken in November, and major indexes have been on a steady climb. Analysts say investors may wind up returning to stocks for many of the same reasons they piled into bonds: a sense of security and greed.
-- Studies show people tend to follow winners. This "return chasing" benefited bond funds when they trounced stocks, and it may help lift stocks next year, Mikkelsen says. The Standard & Poor's 500 index has returned 15 percent including dividends over the past year and has notched two-year highs day after day this month. On Tuesday, it hit the level it traded at just before Lehman Brothers filed for bankruptcy in September 2008.
AGO might make for a good short here...
Gerard Torres, Fool contributor
Bermuda-based Assured Guaranty (NYSE: AGO) will one day go the way of the woolly mammoth, or in financial parlance, the way of Lehman Brothers. Why? Because its services are no longer required.
Assured Guaranty is one of the only municipal bond insurers standing after the destruction of its competition during the financial crisis, but that won't be enough to save it. The business of insuring municipal bonds is quickly dying, as shown by the decreasing number of new municipal bond issues that have insurance. With only a little more than $18 billion in total assets, Assured Guaranty doesn't seem like much of an insurance policy compared to projections of a combined budget deficit of $140 billion for all 50 states in 2012.
If that wasn't enough, Assured Guaranty recently had its credit rating lowered because of expected losses from toxic mortgages, which is exactly what led to the obliteration of Assured's competitors. In other words, if you're a C student, then working with an A student will average you out to a B. There isn't much incentive to work with a B student, since you wouldn't get much of a bump. Well, Assured Guaranty, formerly an A student, just got demoted to a B student. So there won't be many suitors for its services in the future.
16 US Cities Facing Bankruptcy If They Don't Make Deep Cuts In 2011
http://www.businessinsider.com/americas-most-bankrupt-cities-2010-12#
Read more: http://www.businessinsider.com/americas-most-bankrupt-cities-2010-12##ixzz18mRjVzpF
GOP Kills Bonds Program: Secret Plan to Bankrupt States, Bust Public Employee Unions?
Thursday
Dec 16, 2010
4:13 pm
http://inthesetimes.com/working/entry/6781/gop_kills_bonds_program_secret_plan_to_bankrupt_states_bust_public_uni/
60 Minutes on Muni Debt
http://seekingalpha.com/article/242680-the-coming-municipal-bond-crisis
Largest Intitutional Holders of Municipal Debt
http://www.bondbuyer.com/pdfs/040910InstitutionalHolders.pdf
How The Municipal Bond Bust Could Do Big Damage
http://www.huffingtonpost.com/2010/12/02/us-municipal-bond-bust_n_791377.html
Followers
|
2
|
Posters
|
|
Posts (Today)
|
0
|
Posts (Total)
|
30
|
Created
|
12/20/10
|
Type
|
Free
|
Moderators |
Meredith Whitney on Municipal Debt
http://video.ft.com/v/677794093001/Crisis-looming-in-US-municipal-debt-market-
Volume | |
Day Range: | |
Bid Price | |
Ask Price | |
Last Trade Time: |