I get the tax protection of municipals, but I’m very wary of bonds associated with democrats run cities and states. I don’t know a lot of cities to be honest that aren’t dem run....just worried about possible default given how overextended they are.
They are risky because of the pension bombs. They are hoping with a Bidet administration they can go to DC and have you and I pay for their pension by federal government giving them money, i.e. pension envy. Instead of facing the fact that for 20 or more years the pensions have not been funded fully. Typical politician move.
Ex: https://www.chicoer.com/2021/01/15/letter-demands-are-overtaking-needs-of-the-city/
Here’s a good link to a site on public pension at the local, state and federal levels.
Link: http://www.pensiontsunami.com/
So short term or currently they may be a decent investment, but long term many variable factors.
An alternative I found that seems to work well is JPS.
It’s a Nuveen fund.
Dim run cities just raise taxes to cover their bonds. ;)
-SB
In theory, the stability of the bonds should be reflected in their bond rating - more risky bonds will pay a higher dividend/interest, but are more prone to failure. I don't know how accurate they are on municipal bonds - that isn't to say that they're not good, but I'm not experienced and haven't followed.
I am thinking of maybe getting into some muni bonds. Might look into it tomorrow. Time to rebalance anyway.