Keep an Eye on Municipal Bonds

I'm Watching Closely for Signs of Trouble August 14, 2020 UNSUBSCRIBE | ARCHIVES Why are folks buzzing about “Lunchtime Trades?” Please take a minute to watch this brand-new video. It contains rare footage of your editor Graham Summers executing what he calls a "Lunchtime Trade"... You may have heard about them already… Because the buzz is spreading fast… Inspired by the work of a renowned British PhD… and thousands of hours of regression analysis… These unique 2-hour profit windows can give you the chance to pull thousands from the market by lunch… If you invest any money in the markets… You’ll definitely want to see this… Click here now to watch it now. Keep an Eye on Municipal Bonds Dear Money & Crisis Reader, Yesterday, I mentioned that we are on the heels of a debt crisis, and that there is one sector in particular that could be majorly affected: That’s the municipal bond sector. We might have the makings of another collapse. Municipal bonds are bonds that are issued by states, municipalities, or local governments. These bonds are a lot riskier than those issued by the federal government for the simple fact that the federal government can always print money to pay you back. State, municipal, local governments cannot. To compensate for this, the income earned from muni bonds is usually tax free. It’s no secret that certain cities and states have racked up enormous debt obligations. The worst offenders are San Francisco, Chicago, and New York City, which have debt loads of $21 billion, $36 billion, and an eye-watering $196 billion respectively when you don’t account for unfunded liabilities like pensions. When you do include unfunded liabilities, these debt loads balloon up to $28 billion, $68 billion, and an incredible $352 billion respectively. Put simply, these three cities were already up to their eyeballs in debt before the COVID-19 pandemic forced them to be shutdown. Apple Quietly Planning To Kick Off A $260 Billion Revolution? What Apple’s working on now could be far bigger than the iPhone… Investors who take action now could have the shot at life-changing profits from this coming $260 billion revolution. Click here for this shocking prediction. On the Brink of Insolvency Remember, cities and states pay their bonds payments using tax revenues. And with much of the US shut down for several months in 2020, tax revenues have completely collapsed for many cities and states. On top of this, taxpayers are fleeing big cities to avoid higher taxes and civil unrest that has plagued these areas for the last few months. According to a Rasmussen poll, 73% of Americans would “prefer to live in either a suburban area or a rural setting, rather than a large city or urban area.” As a result of this, many big cities like New York City and Chicago are teetering on the brink of insolvency. This is why the Democrats in Congress are pushing for a $3.4 trillion stimulus program, of which a large portion would go towards bailing out the largely blue cities that are in trouble. President Trump has bypassed this by issuing executive orders to continue unemployment benefits and other COVID-19 relief policies. As a result of this, Democrat-run cities and states that are now on the verge of insolvency will need to file for federal bailouts directly. With that in mind, keep an eye on the municipal bond sector. We might have the makings of another collapse. Indeed, high-yield muni bonds have been steadily losing momentum since early June. As I write this, they’re just barely clinging to their uptrend. Will President Trump risk letting a large city like New York or Chicago go bust? He wouldn’t win those cities in the election regardless of whether he bails them out or not. Moreover, playing hardball with the Democrats on this issue would be a big win for Trump with his base. As we near the election, this is a sector I’m watching closely for signs of trouble. Best Regards, Graham Summers Editor, Money & Crisis Facebook’s founder never saw this coming… When Facebook's mega-billionaire sat down before Congress on October 23rd... For over six hours of grueling testimony about his company’s plans for a digital currency called Libra… He surely never imagined that one of the panel’s top-ranking Republicans, Rep. James F. Hill of Arkansas, would be giving him incredibly lucrative advice. But he did — with a tip that could ultimately be worth millions to lots of regular American investors. Don’t worry if you missed it. Because you can get the same advice here, absolutely free — click to see. To end your Money & Crisis e-mail subscription and associated external offers sent from Money & Crisis, click here to unsubscribe. If you are having trouble receiving your Money & Crisis subscription, you can ensure its arrival in your mailbox by whitelisting Money & Crisis. 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