This one made a huge wave today. Buffett the sage of Omaha is exiting the credit default swap market for muni bonds. CDS is insurance for bonds that may default. Buffets Berkshire Hathaway terminated this contract which would have required them to pay in case of default. Buffets vote of no confidence coincides with investorscrushing in to these bonds driving price higher and yields lower. The exited value amts to 8.25 billion dollars.
Berkshire still has exposure to 8billion dollars in debt issued by several cities states etc.
In the nuggets thread we had reported wsj report that junk munis and ordinary munis were an option for yield hungry investors. Let us see how much this roils the muni market.
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