Real-world situation in $4 trillion U.S. municipal bond market alarming, says FT’s Gillian Tett

Financial Times/Gillian Tett

graphic image collapsing house of cards“But while the muni bond market might seem peaceful, the real-world situation in cities and municipalities is alarming. Not only could the current fiscal squeeze eventually raise default rates, deficits are undermining the civic services needed to support recovery.”

USAGOLD note: Another quiet crisis – along with the destruction of Main Street small businesses – knocking on the door of the U.S. economy …… The two, of course, are related since cities depend upon sales taxes to operate. With so much else to worry about, however, this brewing disaster has not received a great deal of attention. Tett lays out her worries at the link above and ends with the admonition that Washington’s political “dysfunction” is “a reason for investors to feel nervous.”

Repost from 10-26-2020

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