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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Jacob Snyder who wrote (71742)	3/8/2011 7:48:43 PM
From: TobagoJack	2 Recommendations Read Replies (2) \| Respond to of 217522

hello jacob, re mub the muni etf, i first reiterate yesterday's inklings: http://siliconinvestor.com/readmsg.aspx?msgid=27219208 "had drinks with a faber and a walker, and dinner with a bunch of big BOYZ last night. The (time horizon w/i 4 months before clarification day) judgment is that some very large and traditionally astute as well as timely BOYZ are raising serious cash by preferred shares for no clearly stated purpose, even as they are seriously back-stopped by some of the largest as well as the largest of sovereign wealth funds, to either - shop now, before clear recognition of very serious hyper flaming inflation, or - ready to shop, after some deluge" ... and ... http://siliconinvestor.com/readmsg.aspx?msgid=27219216 <<The collective wisdom of the BOYZ at dinner last night is that qe3 cannot be tee-ed up and stuffed down until some q4 2008 type of break happens, people get seriously terrified, and politics are aligned for salvation, and that we therefore should clear away the deck chairs by June, step aside, to wait for passing of tsunami. I must look up definition of tsunami.>> i add: - the two big commodity trading and development companies raising cash are either going to shop immediately with the cash, or - expecting serious trouble and getting ready to shop when the shopping gets good - and this news gives me no comfort news.yahoo.com *"Billionaire Carl Icahn returns $1.76B to investors"* therefore, on MUB, whereas it might well tank, as it should, because they are in the aggregate worse off than greece and ireland, and greece and ireland hasn't even begin to crumble as they shall, the constituent parts of MUB may get a pre-emptive bailout if folks are scared enough. having noted above, am also watching and circling MUB, for it ought to be dead security still walking.

To: Jacob Snyder who wrote (71742)	3/9/2011 8:33:18 AM
From: KyrosL	Read Replies (2) \| Respond to of 217522

I am an agnostic on the muni bond market. The article you quoted claims there will be a collapse followed by a rebound, because defaulted muni bonds have very high recoveries. That doesn't sound very bearish. Don't all the smart hedge funds allegedly shorting munis know this? It also claims that the big problem is future pension obligations. But that can can be kicked down the road for a decade or more. That doesn't sound very bearish either, at least in the short to intermediate term. At the same time, the article points out rampant cutting of local government expenses while revenues are slowly recovering with the economy. The fly in this ointment is that the stimulus money will be ending this year. This is bad, but not disastrous. Finally, here is an interesting article about muni bond issuance. In the last couple of months it hit decade lows. California doesn't intend to issue any muni bonds until September, for the first time in its history. online.wsj.com "A Deep Freeze Hits Muni-Bond Market By KELLY NOLAN Municipal-bond issuance is on pace for its lowest quarter in at least 11 years following a rush of borrowing late last year and as government borrowers struggle to get their budgets in order. Through March 4, issuers have sold about $31.5 billion in debt, according to Thomson Reuters. The last time so little in bonds was sold by this point in the calendar was 11 years ago..." Be careful about shorting MUB. You might end up paying its dividend for a number of months before it starts falling, if ever. Of course, all bets are off if the Fed lets (or is forced to let) Treasuries collapse. I think in this scenario shorting Treasuries is a better play.

To: Jacob Snyder who wrote (71742)	3/9/2011 2:17:27 PM
From: Jacob Snyder	Read Replies (1) \| Respond to of 217522

short idea: HYG, junk bonds (the corporate kind) "Investors" are chasing yield, since government debt and hi-quality corporate debt yields so little. With stocks like the big drug companies at a dividend yield of 4-5%, I don't know why anybody would buy bonds of any kind. But... Probably best to wait till it slides below its 200dma, or short in increments, as it's hard to know how high it goes before the inevitable crash.