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rfeinblatt
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Rob Feinblatt is an individual investor.
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  • rfeinblatt
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    Author’s reply » State and local government debt service or interest payments as a percentage of revenues or budgets is almost always less than ten percent. Sure poorly capitalized projects like incinerator or a specific sewage system can be the exception in some states or cities. With that in mind, use your logic. It does very little for a state or city to stop paying debt payments. You kill your credit rating and raise your borrowing costs huge to save the short term non payment of less than ten percent of your budget costs. It is far easier and smarter to attack the ninety percent of your budget which is discretionary spending. Painful but sensible and is why muni defaults are so low. The pundits creating panic are hoping to create situation where rates rise so much it freezes the credit markets. This is unlikely to last as high triple tax free yields attracts all of us especially the baby boomers all retiring at an accelerating pace the next ten years.
    22 Dec 2010, 06:40 PM Reply Like
  • rfeinblatt
    , contributor
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    Author’s reply » So grab those closed end funds in muni land yielding six or seven percent triple tax free while the getting is good.

     

    The place to be
    22 Dec 2010, 06:43 PM Reply Like
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