02.23.08
Talk about Timing: Another short-term US muni market starts to freeze
Yes, even as I try to revive my email from the dead as I got another 50 plus (thanks to all my fans and listeners) after the show plus what I got during the show, the news breaks again and this time, it’s just to validate the “Municide” piece below. This is accelerating and Benron Bernanke had best remove his blinders and drop Fed Funds 100 bps on Monday or this could overwhelm the Fed before the week is out. Check this story out and start to think about the financial models our cities, counties and states put together to finance short term operations then the implications of the great municipal bond crash we could be witnessing:
Another short-term US muni market starts to freeze
I think we can all start to put the implications together but for those that think this is a “nothing to see here move along” event, I hate to disappoint you; it could be a lot worse than just a bunch of monolines blowing up. It could mark the end of our equity markets as we’ve known them.
They had best nationalize the monolines now or forget about it and let the markets make the necessary corrections.
I choose Door#2 but then again, I’m an unabashed laissez-faire capitalist for the most part.
