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Insurers reaffirm their obligations

Q

Maybe Chicken Little has returned, as your article (“Good News: ‘The Sky is Falling’“) says, but it’s hard for a muni investor to ignore the fact that the emergency manager for Detroit is offering 10% of par to the bondholders that lent Detroit money in good faith, fully expecting to get repaid at maturity.

S.F., Connecticut

A

James A. Klotz responds:

We understand. Fortunately, the majority of Detroit bonds, held by individual investors, are insured and the insurance companies have reaffirmed their intention to honor their obligations.

Jun 20, 2013

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