Muni Think

Spoiler alert: Not much. What makes a May Friday a relative oddity is that it was just the first time in 2020 the 30-year UST ended the day unchanged, the second longest span of continuous yield activity since the U.S. government began benchmarking maturities in the late 1970s.

What if there was a debt structure that essentially "refunded" on autopilot, and without transaction cost? Well, the ratchet bond does exactly that.

With states now reopening, will consumers return to their pre-crisis consumption behaviors?

The policy case for federal support is strong: in the coronavirus era, the U.S. is looking at an emergency that is the equivalent of 50 states worth of hurricanes, fires and floods, lasting more than two years, with a very slow economic rebound.

An important corollary of the pandemic is bolstering the green bond market: a heightened level of investors’ attention and sensitivity toward social and environmental issues.

There are, in practice, a limited number of ways to invest in infrastructure and it is impossible to do so without getting involved in state and municipal financing from an effectiveness perspective — putting aside cost, because government entities are the primary way the federal government moves its money into the market.

It is feasible that not all COVID-19 filings are or will be material but one may want to err on the side of caution in this regard.

With tax revenues plummeting, one additional solution policymakers could consider would throw state and local governments a revenue lifeline: uncapping and funding the Community Disaster Loan program.

While the economic data are still bleak, signs of recovery may already be emerging.

Public finance has changed a lot since the Great Depression, so a repeat of that era’s default experience is not preordained even if this contraction matches the worst predictions.