Skip to main content
Black Listed News

Muni Yields Plunge to 1967 Low as Obama’s Tax Plans Stoke Demand

Published: November 9, 2012
Share | Print This


Source: Bloomberg

U.S. municipal-bond yields dropped to the lowest in more than four decades as President Barack Obama’s re-election fueled speculation that income-tax rates will increase, boosting the appeal of tax-free debt.

The interest rate on 20-year general-obligation bonds fell 0.12 percentage point to 3.55 percent in the week ended Nov. 8, according to a Bond Buyer index. That beats this year’s previous low of 3.6 percent and is the lowest since April 1967, when Lyndon B. Johnson was president.

Munis have joined in a post-election fixed-income rally led by Treasuries. Obama wants to increase the top federal income- tax rate to 39.6 percent from 35 percent as part of plans to trim the federal deficit, increasing the attractiveness of tax- free state and local borrowings.

“You’re seeing a renewed interest in tax-exemption from the election,” said Hardy Manges, head of muni trading at Mitsubishi UFJ Securities in New York. “You’re seeing a marketplace that thinks taxes are going higher.”

Bill Gross, who manages the world’s biggest bond fund at Pacific Investment Management Co., said this week that munis are attractive after the election because of Obama’s plan to increase levies.

Read More...

Share This Article...



Connect With Us:
Free Newsletter
Blacklisted Radio
Blacklisted Nation
On Twitter
On Facebook
Podcasts on Demand
Podcasts on Spreaker
Podcasts on Youtube
Podcasts on iTunes
Podcasts on Tunein
Podcasts on Roku

Support Us
Donate Today!

Affiliates
Laverdad Cigars
Beat The Fed
Shop Amazon
Golden Eagle Coins
DHGATE.COM
Chameleon John Coupons
Discountrue




Calling for Contributors!

Got something to say?
We want to hear from you.

Submit your article contributions and participate in the world's largest independent online news community today!

Contact us today!







BlackListed News 2006-2015