The situation surrounding the municipal bond market are nothing new to this screencast. It seems like many are tracing this leg down in muni bond prices to the report issued by high profile analyst Meredith Whitney. If nothing else it helped accelerate a trend in withdrawals from municipal bond mutual funds. Muni bonds are not without their supporters. Some are seeing opportunity as yields have in some cases risen above Treasury yields. Given this back-and-forth Charlie Gasparino wants Whitney to release her report publicly so that everyone can judge the research. This situation feels like another example of market reflexivity at work. Where the interplay between the markets and the media helps create a feedback loop. In today’s screencast we look at the increasingly volatile muni bond market.
Items mentioned in the above screencast:
Investors keep dumping muni bond mutual funds. (Bond Buyer)
Felix Salmon, “Munis aren’t as safe, now, as they used to be, and the existence of ETFs is one reason why.” (Reuters)
Citigroup thinks muni bonds are oversold. (Money Game)
David Rosenberg sees opportunity in the wreckage of the muni bond market. (Pragmatic Capitalism)
Charlie Gasparino wants Meredith Whitney to publicly release her report on the potential for muni bond defaults. (Huffington Post also The Reformed Broker, Dealbreaker)
Daily price chart of the iShares S&P National AMT-Free Muni Bond ETF (MUB). (Finviz)