Post by Joe Cocker on Aug 26, 2012 12:35:36 GMT -5
Warren Buffett Companies STOP Insuring Municipal Bonds
We know that Moodys has downgraded numerous California cities and bonds. This has added costs to future bond sales. Now we find out that Warren Buffett—a Leftist big taxer, but brilliant in the marketplace—has his firms no longer insuring bonds against default.
“In a move that should give genuine concern to investors in U.S. municipal bonds, Warren Buffett’s Berkshire Hathaway (NYSE: BRK-A ) (NYSE: BRK-B ) has terminated insurance contracts it sold against default on $8.25 billion in state and municipal debt “.
Buffetts’ actions are clear, he believes that municipal bonds are going to default—like they have in Vallejo, Stockton and San Bernardino. Moodys believes 10% of California bonds will default.
California is in a Depression and Buffett is betting the nation is headed toward the same economic result.
www.fool.com/investing/general/2012/08/22/muni-defaults-buffetts-warning-is-loud-and-clear.aspx
We know that Moodys has downgraded numerous California cities and bonds. This has added costs to future bond sales. Now we find out that Warren Buffett—a Leftist big taxer, but brilliant in the marketplace—has his firms no longer insuring bonds against default.
“In a move that should give genuine concern to investors in U.S. municipal bonds, Warren Buffett’s Berkshire Hathaway (NYSE: BRK-A ) (NYSE: BRK-B ) has terminated insurance contracts it sold against default on $8.25 billion in state and municipal debt “.
Buffetts’ actions are clear, he believes that municipal bonds are going to default—like they have in Vallejo, Stockton and San Bernardino. Moodys believes 10% of California bonds will default.
California is in a Depression and Buffett is betting the nation is headed toward the same economic result.
www.fool.com/investing/general/2012/08/22/muni-defaults-buffetts-warning-is-loud-and-clear.aspx