What could be more benign than that boy scout of financial instruments, the municipal bond? What town has not floated an issue to build a road? What little old lady (or big mutual fund) has not heard an accountant extol "munis" as the most foolproof of investments? Lending to companies is risky: they fold overnight, leaving squabbling creditors. But municipalities don't disappear from the map; and knowing they will borrow more tomorrow, they will do anything -- even raise taxes-to avoid defaulting today.
Or so it seemed until an extraordinary vote last Tuesday in Southern California's Orange County. Since its former...
To continue reading:
or
Log-In
