Ever since the election, there’s been a massive selloff in munis, thanks in part to state debt fears, plus the end of the Build America Bond program, which eliminates government backing for certain issuances. Also, the rise in rates has taken its toll across all fixed income.
The collapse has really been remarkable, and scary.
But look who’s buying.
FT notes that according to recent filings, Bill Gross has just invested $4.4 million of his own money. In total he’s controlling $8.9 million personally.
Cue the conspiracy theories about how Gross knows that Bernanke will step in and directly monetise state debt!
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