According to an article from InvestmentNews.com, the Financial Industry Regulatory Authority (FINRA) has ordered Southwest Securities Inc to pay $650,000 to “resolve claims over improper short sales.” FINRA said that the improper sale caused a $6.3 million loss for the firm.
Just as unscrupulous teachers manipulate student performance to increase their own fortunes, so some mutual fund managers are over-pricing their bond portfolios to attract investors. Bond values are not easy to determine in the current atmosphere of state and municipal budget shortfalls and fewer tax receipts. Generally traders and portfolio managers prefer to rely on […]
As panic has come over the muni market with widespread fears of default at all levels, many municipal bond investors are still ignoring warnings forecasts of possible defaults and are relying on the fact that a huge portion of the municipal bonds issued are “general obligations” of the states and cities issuing the bonds. Although […]
Citigroup’s problems with its proprietary MAT/ASTA municipal arbitrage funds just keep growing. A recent Wall Street Journal article by Suzanne Barlyn entitled “Citi Units Must Pay $6.4 Million Over Muni-Arbitrage Loss,” which concerns Citi’s disastrous MAT/ASTA municipal arbitrage funds, reports a significant $6.4 million award issued against Citigroup in a MAT/ASTA case by a Financial […]
The quality and timeliness of information that state and local governments are disclosing about their finances is becoming a growing concern for both investors and regulators. The Securities and Exchange Commission (SEC) is searching for cases in which municipalities failed to warn investors of fiscal problems. Recently, the SEC brought a case against New Jersey, […]
All is not well in the Land of Lincoln. The state’s governor’s office confirmed this week that the Securities and Exchange Commission (SEC) has launched an inquiry into public statements by Illinois officials concerning the state’s underfunded pension fund.
Municipal bond funds are hemorrhaging. Investors removed $4 billion from municipal-bond funds in the week ended January 19, the largest outflow since Lipper began measuring muni fund flows in 1992, said Kelly Nolan and John Kell in their Wall Street Journal article, “Record $4 Billion Exits Muni Funds.” The previous record was a $3.1 billion […]
According to an article by Charles Riley for CNN Money they are. Municipal bonds continued to sell off last week with investor worried about state and local government budget shortfalls highlighted by the media in recent weeks. States such as California and Illinois face budget shortfalls of billions of dollars, making the growing fears easy […]
Recent moves by The Vanguard Group highlight the increasing risks in the municipal bond sector. As a result of volatility in the municipal bond market, Vanguard has withdrawn documents it filed with the Securities and Exchange Commission (SEC) to launch three new municipal bond index funds and three municipal bond exchange-traded funds.
The future of MBIA, the monoline insurer of mortgage-backed securities and municipal bonds, among other things, is in peril and likely dependent on the outcome of litigation, according to Floyd Norris in his Jan. 6 New York Times article, “MBIA Fights Banks for Its Life.” Standard & Poors reportedly downgraded MBIA to junk status and […]
