[quote=Hatfield]I’m actually curious about CA muni bonds maturing in the next 6-12 months. Idea is to hold until maturity. Apparently you can get them in the 3.5-4.5% range, no state tax. What I don’t understand is the re-insurance landscape: what happens if a muni defaults, who’s the insurer, how solvent are they, etc? [/quote]
In theory, bondholders will eventually be made whole, as long as the amount of outstanding debt is smaller than the market value of all state assets (and I’m not saying it is … but that’s something that can be easily researched).
I just don’t care to test that theory for a 4.5% return.
