Some may dream of the Fed riding to the rescue of ailing states and cities - trouble is, it...

|By:, SA News Editor

Some may dream of the Fed riding to the rescue of ailing states and cities - trouble is, it can't. The Federal Reserve Act limits Fed open-market purchases of municipal bonds to those with maturities of no more than six months. Yet it is yields on long-dated munis that look especially stressed, made worse by the expected expiration of Build America Bonds.