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| BondsOnline.com: instant access to and extensive coverage of over 3.5 million stocks, bonds, indexes and other securities covering major and emerging markets and exchanges across the globe. |
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| Bonds Online |
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| 5/10/2013Market Performance |
| Municipal Bonds |
|---|
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S&P National Bond Index
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3.00% |
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S&P California Bond Index
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2.96% |
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S&P New York Bond Index
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3.13% |
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S&P National 0-5 Year Municipal Bond Index
|
0.70% |
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| S&P/BGCantor US Treasury Bond |
400.09 |
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| More |
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| Income Equities: |
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| Preferred Stocks |
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S&P U.S. Preferred Stock Index
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848.03 |
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S&P U.S. Preferred Stock Index (CAD)
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636.26 |
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S&P U.S. Preferred Stock Index (TR)
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1,701.05 |
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S&P U.S. Preferred Stock Index (TR) (CAD)
|
1,276.26 |
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| REITs |
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S&P REIT Index
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174.07 |
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S&P REIT Index (TR)
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425.30 |
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| MLPs |
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S&P MLP Index
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2,469.58 |
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S&P MLP Index (TR)
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5,428.50 |
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See Data
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There’s Turmoil in the Municipal Bond Market as Cities Struggle |
ConsumerAffairs.com - Nov. 30, 2010 - By Fred Yager
If you wanted to see your money grow without being clobbered by a hefty tax bill, Municipal Bonds were a good way to go. And in many cases they still are with their huge tax advantages that include exemption from federal, state and sometimes even local income tax.
Unfortunately, the muni bond market has been in a state of turmoil over rising uncertainty over the financial strength of some of the municipalities issuing those bonds. It has become a highly fractured market.
Prior to 2008, the muni world was homogenous. Many bonds were insured and considered safe. Today only about 7% fall into that category. The steady economic growth over the previous two decades meant government budgets were in good shape. But the financial crisis changed all that.
One way to look at it is that before the financial crisis there was one municipal-bond market and now there are more than 20,000. Usually, the muni market is steady. Lately, it's been anything but. The recent selloff has caused the Bank of America/Merrill Lynch Municipal Bond Master Index to fall 3.6% this month.
A number of factors are behind the mess and an unusual combination of events triggered a selloff. First, treasury yields rose and that led to losses on bonds across the board. Investors sold older bonds to make room for newer ones just as a large supply of muni-bonds hit the market. Then a number of states such as California found themselves staring at budget shortfalls and potentially being unable to meet pension obligations.
The financial crisis also drained the muni market of liquidity. Bear Stearns and Lehman Brothers were two major muni-bond dealers before they blew up. Other banks and brokers have been less willing to hold large amounts of muni bonds on their books, while some hedge funds that used "arbitrage" strategies in the municipal-bond market pulled back or disappeared.
Also, now that congress is back from vacation, there's the question of whether the Republicans will be able muster enough votes to end the Bush tax cuts for everyone, even the upper income Americans who use munis as much as anyone to reduce their tax bite.
Read more: http://www.consumeraffairs.com/news04/2010/11/there-s-turmoil-in-the-municipal-bond-market-as-cities-struggle.html#ixzz16sbMXl5c
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| BondsOnline Advisor |
Income Security Recommendation January 2013 Issue.
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