Many have voiced their opinions on why “hundreds of billions” of defaults in municipal securities within the year is an inaccurate reflection of the market. Promoting outlandish default predictions does a disservice to the investing public, as well as to the issuers, rating agencies, insurers, credit analysts, portfolio managers, and other market participants who work diligently to provide their respective services.

We analyzed the numbers to determine what’s really at risk, using a more pragmatic approach. While bankruptcy and default statistics are important, the ultimate recovery rate to the investor is what’s really at stake, and where the focus should lie. We have concluded that investors may suffer unrecoverable losses in the range of $10-20 billion over the next ten years.

Read more at$10-20B.pdf.

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