Muni buyers and owners listen up. If you haven’t been paying attention you might not know but in the last week the value of your muni bond portfolio has dropped 5%. The trade that looked good after the Presidential election is starting to look very very bad. I’ve said time and time again you don’t get compensated enough in the fixed income markets for the multitude of risk you take. Interest rate risk, event risk and now Government risk.
Timothy L. Firestine, the top government administrator in Montgomery County, Md., is crunching numbers in his battle to preserve the hallowed tax exemption on municipal bonds.
via Municipalities Fight a Proposal to Tax Muni Bond Interest – NYTimes.com.