BondGuy

Some Muni Bonds Appear Screaming Buys Here

"As long as property values keep declining, cities will take in less and less revenue - potentially endangering those muni bonds. I was thinking of moving into munis myself, but if this property deflation carries on too long..."

REVENUES WILL NOT NECESSARILY FALL, SINCE MUNICIPALITIES CAN SIMPLY RAISE THE MILL RATE TO COMPENSATE FOR FALLING ASSESSMENTS. MOREOVER, EVEN IF THERE ARE FORECLOSURES, THE FORECLOSING BANK OR SUBSEQUENT OWNER WILL HAVE TO PAY THE BACK TAXES ON THE PROPERTY LIEN.