How To Understand Muniland’s Good Yields And Bad Yields

“If it’s not one thing, it’s another.” These are words of the Saturday Night Live character, Roseanne Roseannadanna played by the late Gilda Radner. They truly exemplify what’s happening in the municipal bond market. Certainly, the pitfalls are few in Muniland, hence the low default rate, but the outliers and worries are increasing.

I have railed for years about municipalities not filing timely financials or not filing them at all. Now, the rating agencies are downgrading them for this dereliction of duty. That’s great news.