Muni Bonds: A Case Study of Detroit’s Fiasco

detroit

My biggest concern with folks who buy muni bonds is that they don’t do the proper due diligence on a given municipality. It’s very easy to just assume that if a municipality or a city is big enough, there’s simply no chance of default. Given that … [Read more...]

Risks of Rising Interest Rates for Long Term Bond Holders

Treasury Inflation Protected Securities

The general consensus is that interest rates in the United States are expected to move upwards over the next year or two. This possibility raises a concern for those individuals that have invested in longer-term bonds in the hopes of gaining a higher … [Read more...]

Investors Should Think Twice About Owning Mortgage REITs

mortgage_reits

Mortgage REITs, unlike equity REITs, are a class of real estate investment trusts that concentrate their efforts on owning mortgage debt. By leveraging their investments, mortgage REITs are able to offer investors extremely enticing dividend yields. … [Read more...]

Rethinking the United States ‘AAA’ Rating

US-debt-ceiling

When I first read about the rating agency Fitch recently placing all outstanding U.S. sovereign debt securities on Rating Watch Negative (RWN), I couldn’t help but spend some time thinking about why exactly the U.S. still carries a ‘AAA’ rating. Both … [Read more...]