Do muniland’s flare-ups signal a bigger fire?

By Cate Long
July 16, 2012

Now that three California towns have declared bankruptcy in the past few weeks, the mainstream media is abuzz with headlines of imminent doom for state and local governments. Adding fuel to the fire were Warren Buffett’s comments on Bloomberg TV about how cities may find it easier to declare bankruptcy after seeing others do it:

Why America won’t pay for more stimulus

By Cate Long
June 1, 2012

This morning’s jobs report revealed that 79,000 net new jobs were created in the country in May, nearly 50 percent below the consensus forecast of 150,000. Almost immediately following the release, there were loud and insistent calls for another round of monetary and fiscal stimulus. “Job growth stumbles again, raising pressure on Fed,” the Reuters headline ran. My fellow Reuters blogger Felix Salmon called for immediate federal stimulus funded by more debt issuance. Felix’s rationale, like many others’, is that with U.S. borrowing costs so low, stimulating current economic activity is a higher priority than worrying about paying down the debt in the future. Or to put it differently, a little more debt is preferable to enduring the economic pain of the economy rightsizing itself.

States receive crumbs from mortgage settlement

By Cate Long
February 10, 2012

The $25 billion mortgage-fraud settlement that was announced yesterday came after 18 months of coordinated action by the Department of Justice, the Department of Housing and Urban Development and 49 state attorneys-general. The settlement is carved up so that homeowners and governments at the state and federal levels each receive some compensation. Given the scale of national losses, it’s a tiny penalty for banks that engaged in egregious servicing and foreclosure practices, and it will do little to repair the widespread economic damage.

Is Meredith Whitney a ratings’ driver for CNBC?

By Cate Long
June 28, 2011

It’s more than a little frustrating that CNBC continues to feature equity analyst Meredith Whitney as she talks about municipal bonds over and over again. I’m not really sure she evens knows what she is talking about.

8 weakest U.S. states

By Cate Long
June 24, 2011

According to the credit rating agencies and the bond markets, these are the 8 states with the weakest credit profiles. These states may be weak because their debts are too big, because their economy is flagging or because they haven’t adequately funded the retirement of their employees. If this were a school, these would be the students sitting in the back of the class. Maybe it’s time for these states to do a little more homework.

Muni sweeps: How much job creation?

By Cate Long
May 27, 2011

Job creation or program pass-through?

The Congressional Budget Office has published a new report entitled “Estimated Impact of the American Recovery and Reinvestment Act on Employment and Economic Output from January 2011 Through March 2011.” It makes some large claims about how many jobs stimulus funds have created:

Let’s give Meredith some credit

By Cate Long
May 6, 2011

Everybody beats up on Meredith Whitney for her muniland panic call.

Yesterday she doubled down on her prediction of “hundreds of billions of dollars’ worth” of municipal-bond defaults.

Muni sweeps: Riding the Federal cash flow

By Cate Long
April 25, 2011

It’s an important week  for the fixed income markets: Ben Bernanke, the chairman of the Federal Reserve, will hold his first press conference on Wednesday.