One of the establishments ever created to supply public investment to state and local governments is the municipal bond market, which is a simple and competitive source of investment for governments, both for their own wishes and for local projects that create more jobs. and investments. The appeal is that it places investment decisions that affect local economic well-being at the local level, not in Washington, DC, where such decisions can be made. Of course, there is a lot of inefficiency and abuse, but there are also buyers, the SEC, the IRS, and the state securities government to enforce enough restrictions to involve abuse.
While one may write an e-book on taxpayer abuse caused by reckless use of municipal debt through local authorities, I will focus here on the abuses we suffer through personal users of the municipal market. This has been a challenge for decades, but it has not been detected because most of those bond challenges are small and losses attract few revisions or public comments. In later years, we have called on abusive players or practices to alert current ones to What We Did for Texas and MUD Pension Bond Challenges in the 1980s, problems in the 1990s, and Florida CDDs in the 2000s.
The Wisconsin Public Finance Authority represents a new type of abuse of issuers whose consequences are only just beginning to appear. The abuse here is that they allow bond problems in which the state of Wisconsin surely has no financial interest or need. A superficial review of their legal problems shows them approving bonus problems for another 10 states up to $800 million long for the recent American Dream Mall in East Rutherford, New Jersey. The valid objective that we can see in these movements is to bear fruit, but they raise considerations about the reasons It can also be assumed that the marists are attracted to this issuer because the approval procedure is easier. We let others investigate because the practice undermines the integrity of the entire market.
Questions arise about how these bond problems are included in the federal quota on the amount of bonds that a passing government can factor out tax-free. Also, how misleading is this to bond buyers and what do they look like in single-state bond funds?For state oversight of factored bonds for projects in that state, doesn’t that undermine their credibility and authority?I have no answer, but I know it’s Wisconsin’s duty to justify its violation of the state’s economic progression. Texas and Florida have tightened regulations for network progression projects caused by great overconstruction. Are we now allowing those developers to move to Wisconsin if the local or state government hesitates?The same questions arise for pension establishments and autonomous schools. Let’s keep the municipal investment at home.
Richard Lehmann is the editor of the Forbes/Lehmann Municipal Debt Report. Www. distresseddebtsecurities. com
I am a former Forbes columnist, investor and editor of the Forbes/Lehmann Municipal Debt Report. As a lifetime investor in postage stamps, I have