The Pension Crisis And The Muni Bond Market
Underfunded pension plans grab the headlines. But that’s not what drives prices in the municipal bond market, according to Tom Doe. It’s the interplay between supply and demand – and right now yields are depressed due to a shortage of high-quality bonds.
“It’s all about investing the massive amount of money coming into this sector,” Doe said. He added that this is the biggest supply shortage since the fall of 2013.
Doe is the founder and chief executive officer of Concord, MA-based Municipal Market Analytics (MMA), an independent research firm that provides strategic market and credit research on the U.S. municipal market and industry. I spoke to him on June 23.