Negative Yields and Wide Spreads Plague the Muni Markets

Negative Yields persist in the Municipal Bond markets. In the 2nd Quarter of 2003, MunicipalBonds.com has uncovered a total of 1,352 Negative Yield markets. (For a full listing of these negative yields please see link below.)

The problem of Negative Yields is statistically getting worse. The 1,352 number is an increase from the 1st Quarter of 2003 which tallied 1,135 Negative Yield markets. Because the Muni industry restricted trade and price transparency when reporting actually was forced upon them in 1994, our studies only date to the beginning of 2000. For comparison, in the entire calendar year of 2002 we uncovered 1,681 Negative Yields; in 2001 there were 779 Negative Yields; and in 2000 there were 512.

MunicipalBonds.com again asks Congress, the SEC, the MSRB and the NASD; what do you think? what do you have to say? and what are you going to do? Please see www.MunicipalBonds.com for background information.

2003/Q2 Negative Yields List
http://www.municipalbonds.com/yields/report2003Q2.html

Wide and potentially illegal spreads also continue to plague the Muni Markets. In it's continuing series, MunicipalBonds.com releases the following Worst Spreads Reports for the 2nd Quarter of 2003. Please note: Earlier in the quarter MunicipalBonds.com registered numerous complaints with the SEC, MSRB and NASD about what we perceived as a system/member reporting problem. We wish to thank the Muni authorities for correcting the situation. But the result can nonetheless be seen in the opening lines of all spread reports. A few years ago, the MSRB defended the Muni industry by suggesting that spread problems were the fault of clerks and input errors. If you still believe this rationalization, perhaps it is time to do something about clerk education and training...especially since you have plans to move to real-time reporting.

2003/Q2 One Hundred Worst Bid/Offer Spreads:
http://www.municipalbonds.com/redflag/report2003Q2.html

2003/Q2 One Hundred Worst Bid-side Spreads:
http://www.municipalbonds.com/redflag/report2003Q2bid.html

2003/Q2 One Hundred Worst Offer-side Spreads:
http://www.municipalbonds.com/redflag/report2003Q2offer.html

2003/Q2 One Hundred Worst "Two-Trade" Spreads:
Do these types of trades better expose intent?
http://www.municipalbonds.com/redflag/report2003Q2two.html

Contact: Kevin Olson
Company: MunicipalBonds.com
Phone: 415-922-7870
Email: Kevin@MunicipalBonds.com
URL: http://www.MunicipalBonds.com