This is something I have been warning about that none of our politicians are addressing....yet
From the WSJ:
Debt investors are nervous lately. Borrowing is expensive and hard for cities, states, hospitals and turnpikes nationwide. Such extra costs will likely be met by raising taxes in coming months.
The yield escalation has been striking. According to a Securities Industry and Financial Markets Association index, high-quality municipal bonds rose to 7.96% Wednesday, from 5.15% in the prior week and 1.79% the week before that.
Municipal bonds have historically yielded less than Treasurys because investors don't have to pay taxes on munis. But now 30-year municipal bonds yield about 120% of 30-year Treasurys. That ratio is "about as high as it's ever been," says Matt Fabian, senior municipal analyst at Municipal Market Advisors.
The municipal bond market is about $3 Trillion dollars. $3 Trillion dollars. Do you really think a $700 Billion dollar Wall Street welfare package will have any impact on this much larger issue???
Where the f*^k are our politicians thinking????? If cities with taxing authority are having trouble borrowing from the non banking markets.....this problem has spread much further than the limited nonsense package they are quibbling over.
Save the Federal Government....it is evident that much of the economy is now insolvent.
We must restructure and resturcture right now....or else the nation will systematically shut down....very very soon. The municipal debt market is melting down and not a single politician is addressing the issue.
How many hundreds of billions will be required to bail out cities and states??? What about credit cards???? What about commercial real estate debt????? Would about private equity bridge loans that have become bridges to nowhere????
The mortgage meltdown is morphing into a debt meltdown.....and our polticians are bickering how much money we should give Wall Street????? My guess is that a much larger crisis arises next week......don't say you weren't warned.
Wouldn't it be nice if our politicians actually addressed the problem and simply not try to had over $700 Billion to their largest contributors?????
At this point, it has become clear that our President and many of our politicans on both sides don't give a damm about the American people and are simply acting in ways to enrich themselves and their buddies as our cities are about to implode financially.
Evil trimuphs when the good do nothing.