New Jersey’s Pension Crisis: A Canary in the Coalmine?

Fortune Magazine recently published an article outlining New Jersey’s pension dilemma. Based on the information in this article, it appears that New Jersey could very well be the canary in the coalmine when it comes to the widespread pension crises that threaten to impact states and municipalities throughout the country. Let’s take a look at New Jersey’s situation and the broader implications for taxpayers, bondholders, and retirees.

The Federal Government’s “Safety Net” for Municipal Bonds Has Obvious Costs

Municipal bonds have traditionally been extremely safe investments with very low default rates and attractive tax exempt features for most investors. Municipal bond insurance has allowed state and local governments to obtain higher credit ratings, thereby generating significant interest savings over the life of the bonds. The municipal bond insurance market has been through major changes in the past year and could be in for even more change going forward. Read this article for more details.


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