Brian Chappatta —Fed Should Buy Muni Bonds to Fight the Next Recession

Say what you will about modern monetary theory, but it’s worth asking why it’s assumed that states in America, which wields the power of the world’s reserve currency, should turn to draconian austerity measures when the going gets rough. After all, no political party at the federal level even pretends to care about budget balance anymore. Governors, on the other hand, must spend within their means and consider trade-offs, whether they’re a Democrat or Republican. To their credit, many have chipped away at long-term problems. 

When the next recession comes around, though, they might not have the tools to go at it alone. They’re going to need a lift. The Fed should stand ready to provide that boost.….

NewsMax Finance
Fed Should Buy Muni Bonds to Fight the Next Recession

Brian Chappatta | Bloomberg Opinion columnist covering debt markets, previously covered bonds for Bloomberg News, and is a CFA charterholder

Pam and Russ Martens — Puerto Rico’s Debt Is Quietly Sitting in Mom and Pop Mutual Funds as Trump Says It Will Be Wiped Out

There was likely a collective gasp at OppenheimerFunds Inc. yesterday when President Donald Trump made another of those market-moving pronouncements, telling Fox News that Puerto Rico’s debt would have to be wiped out. The President’s remarks suggested he thought the losers would be Wall Street banks. The President stated: “You know they owe a lot of money to your friends on Wall Street. We’re gonna have to wipe that out. That’s gonna have to be — you know, you can say goodbye to that. I don’t know if it’s Goldman Sachs but whoever it is, you can wave good-bye to that.”

The reality is that a large percentage of Puerto Rico’s debt is held in tax-free municipal bonds and municipal bond mutual funds, owned not by Wall Street banks or tycoons, but by mom and pop investors seeking tax-free income….

Wall Street On Parade
Puerto Rico’s Debt Is Quietly Sitting in Mom and Pop Mutual Funds as Trump Says It Will Be Wiped Out
Pam Martens and Russ Martens

Ellen Brown — Swimming with the Sharks: Goldman Sachs, School Districts, and Capital Appreciation Bonds

The saga of the Vampire Squid continues.

Remember when Goldman Sachs – dubbed by Matt Taibbi the Vampire Squid – sold derivatives to Greece so the government could conceal its debt, then bet against that debt, driving it up? It seems that the ubiquitous investment bank has also put the squeeze on California and its school districts. Not that Goldman was alone in this; but the unscrupulous practices of the bank once called the undisputed king of the municipal bond business epitomize the culture of greed that has ensnared students and future generations in unrepayable debt.…

Web of Debt
Swimming with the Sharks: Goldman Sachs, School Districts, and Capital Appreciation Bonds
Ellen Brown