Falling Oil Prices The most heavily traded U.S. crude-oil futures contract fell 43% on Tuesday, April 21st to $11.57 a barrel, its lowest close in [...]

COVID-19 | Municipal Bond Market Update Even as the US COVID-19 death toll tops 40,000 lives and unemployment insurance claims continue to rise by multiple [...]

COVID-19 | Municipal Bond Market Update The municipal bond market is starting to see some signs of stability as rates in the Municipal Market Data [...]

Coronavirus Municipal Market Update from PMA Just two days after PMA circulated its March 23rd market update, describing a swift and historic increase in municipal [...]

Financial Markets Update In a massive emergency move on Sunday, the Federal Reserve took multiple actions in an effort to cushion the economy from the [...]

Coronavirus Update from PMA At PMA, our mission is to help our clients and communities to be more successful. That includes prioritizing the safety and [...]

Prudent Man Money Market Update In an effort to calm markets, the Federal Reserve cut the fed funds rate by 50 basis points to a [...]

PUBLIC FINANCE TRENDS

BQ Benefit and IL Premium
This issue focuses on two fundamental trends with a noteworthy impact to our clients. The above-left graph compares a recent non bank-qualified (NBQ) Aa2 transaction with a bank-qualified (BQ) Aa2 transaction. The BQ benefit is insignificant through the first nine years of the yield curve, but offers more value in year ten and beyond.

PUBLIC FINANCE TRENDS

Interest Rates and Bond Insurance
The graph above left compares Bloomberg AAA municipal rates from 7/9/19 with those from early May, the last edition of this newsletter. Interest rates continue to fall in 2019 with rates now lower by as much as 0.33% in just two months. The graph above right compares an underlying AA credit with an insured AA (A- underlying) credit.

PUBLIC FINANCE TRENDS

Declining Interest Rates, Increasing Financial Disclosures
The graph above-left compares the Bloomberg municipal AAA interest rates from 1/3/19 with those from 5/3/19. Interest rates have come down by as much as 0.42% in the 19-year term (2038). As the Federal Reserve maintains a very conservative approach to changes in the Fed Funds Rate, this downward trend in interest rates is likely to remain.