Sunday, March 02, 2008

Muni insurance: Who needs it?

More and more critics are asking the muni bond insurers: Who needs ya?

Today's story in the New York Times gives the issue more prominence. The story says Moody’s estimates that more than half of the muni market would be rated AAA or AA using the corporate scale. As one California rep told me today, if the bond is really AAA to begin with, who needs the insurance?

Good question.