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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host
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To: Kirk © who wrote (41757)12/29/2008 11:33:11 AM
From: gronieel5 Recommendations  Read Replies (3) of 42834
 
"...The basket-turd defending the evasive non-answer given by "Brinker the Terrified of Truth" is taking advantage or a technicality that CA GO bonds (and many others) are callable but only on certain dates. So... when the state wants to call these bonds, it borrows money at much lower interest rates and funds the P&I for the GO Bonds to the call date in an account backed by Treasuries so the State has no risk of defaulting. They do this because it saves the borrower, the State of CA, a lot of money... thus it means the lender makes less money than planned... and has to reinvest the funds at much lower interest rates... all bad news for the lender but good for us tax payers in CA..."

Just when I think you can't post any more incredibly naive gibberish...you do!

Why are you yammering about taking advantage of a technicality? Most, if not all, GOs are callable on dates certain and the investor is fully aware of that from the issue date.

And guess what Kirk...some folks even calculate yield-to-call when they buy those bonds.

And your explanation that ST Treasury rates are low because States are pre-refunding borders on the ludicrous.

Your entire post is a shining example of rank amateurism and reflective of the dangers of "self-teaching".
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