Friday, August 08, 2008

No More Cheap Money for Municipal Borrowers

Bloomberg reports that the era of cheap money for municipal borrowers is over, citing the Bay Area Toll Authority's recent of auction of bonds at rates as high as 5.33%.

How long before the era of cheap money is over for everyone?

If you believe it's not long, I suggest you unload your US Treasuries and bonds, or better yet, unload them and go short. Rising rates are going to cream bond prices.

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