Municipal Bond Forum

So let’s say the Fed goes crazy and raises rates a whopping 1/4%, as you suggest in your article, “The Fed Didn’t Move. Cue the Conjecture.” What kind of impact will this translate to someone who owns a high-yield muni bond fund? If you had a liquid $50,000, what would you do with it, if you could only invest for six months?

M.G.

I read that Puerto Rico stopped setting aside money to pay the General Obligation interest payment in January 2016. Do you think this is indicative of their intent not to make the January 2016 payment?

K.H., Indiana

What are some of the scenarios we bondholders can now expect concerning the outcome of the Puerto Rico debt problem?

R.W., North Carolina

If Puerto Rico gets approval to file Chapter 9 – and does – will this be good or bad for the bondholders?

D.H., New Jersey

In “Puerto Rico: Unable or Unwilling?” you mentioned COFINA bonds, which I own. Payment is due Aug. 1 and I noted the revenue for those bonds was fully collected by year-end 2014. Can we expect timely payment?

C.G., New Hampshire

Lots of “ifs” in your article “Puerto Rico: Unable or Unwilling?”  Existing bonds insured by AGC and maybe National might pay off if we’re lucky. Payment for COFINA bonds are due Aug. 1. Puerto Rico’s debt is “CCC-” on its own. There are better opportunities out there, even Chicago!

J.M., Florida

In your article, “Puerto Rico: Unable or Unwilling?” you quote the president of the Government Development Bank as saying officials expect to negotiate a “consensual adjustment” regarding Puerto Rico’s debt. What kind of haircut are we talking about? I committed my financial resources to their bonds and now I’m supposed to give even more.

G.R., Michigan

In your article, “Report: Muni Investors Had a Lousy Spring,” I really like your attitude and your strategy. What advice do you have for a guy whose money is tied up in a large 401(k)? I’m 66 and retiring soon.

R.O., Florida