Irresponsible gov't spending could hit munis

Crickets ....... The silence from the lack of responses is deafening and telling.

I've always wondered what crickets sound like when they're projectile vomiting.

LICCDope's best source for political info and guidance THE NY POST!!

you are just the simplton they love to prey on--youre like rupert's lapdog--lapping up bowls of fatty garbage

One could do worse than to be a lapdog to a powerful, popular, billionaire, right?

The liberals continue to flail foolishly by attacking the messenger, in this case Charles Gasparino, because they can't argue the message.

"Argue the message?" Nice Brit affectation. What, exactly, is the message? Municipalities are in the toilet because they over-invested in a false economy that was propped up by the Bushies and allowed to flourish because of a lack of oversight/regulation. If that is the message, I don't "argue" it; I agree with it.

Muni crisis is over-blown. Sure there will be some defaults, but state g.o. bonds and those backed by redognizable revenue streams will be OK. The point of a g.o. is it's backed by taxes which can be raised. Meredith Whitney is being a Cassandra.

Riversider calling for higher taxes? Bizarro world has arrived.

gaspipe charlie is a moron--he should be plugged into a power plant--he's your perfect leader LICCDope

true all that midtownereast

Whitney doesn’t have specific numbers backing up her now- famous prediction, she said in a Jan. 30 interview. “Quantifying is a guesstimate at this point,” she said. “I was giving an approximation of a magnitude that will bear out to be correct.”

Meanwhile, investors pulled about $4 billion from municipal-bond mutual funds in the week ended Jan. 19, the most since Lipper US Fund Flows started compiling the data in 1992. The withdrawals marked the 10th-straight week of net redemptions, totaling $20.6 billion, according to Denver-based Lipper. Returns on municipal securities fell the most in 16 years in the 2010 fourth quarter, according to a Merrill Lynch Municipal Master Index. The cost for AAA-rated issuers to borrow for 30 years climbed by almost a third, to 5.09 percent on Jan. 17, from 3.85 percent Nov. 1.

Report Doesn’t Mention

A copy of the 43-page report obtained since then doesn’t mention sizable defaults amounting to hundreds of billions of dollars. A person who has seen a long addendum that profiles the 15 top states said that the longer portion doesn’t, either.

“We are not calling for any specific defaults within the scope of this report,” the document says on page 42. An opening summary says there will “invariably” be local defaults, without elaborating.

She said Jan. 30 she plans to build a ratings service for which she’ll hire “hundreds of people” for municipal securities. She would also rate corporate debt and structured products, she said, adding that her business model would be a hybrid that includes fees paid by issuers.

Lack of Credibility

Among key points at the SEC meeting, according to a regulatory filing, was that the “construct of rating agencies has little to no credibility, is not trusted, and ineffective.” Asked Jan. 30 what improved credibility she could bring to ratings, she said she has “an untarnished track record.”

Bloomberg News reported in October that about two-thirds of her stock picks since starting her company in 2009 had fared worse than market indexes. Visa Inc. fell 14 percent after she called it her “single best buy,” and Capital One Financial Corp. tripled after she urged clients to sell.

http://www.bloomberg.com/news/2011-02-01/whitney-municipal-bond-apocalypse-is-short-on-default-specifics.html

They're already talking about changes in legislation to allow states to declare some form of bankruptcy. I had a lot in muntis a few years back, and pulled out most of it to put it into the stock market when things fell... fairly happy that happened, don't plan on going back in.

SWE. That talk does not appear to be gaining too much traction. But it causing some investors to choose revenue bonds over g.o. bonds in some cases.