why have california muni funds lost value while yields have remained stable?
Thanks for your question. I checked in with Leonard C. Wright, CPA/PFS who is based in San Diego, California. He provided us with the following answer. I hope it helps. Please follow-up with any additional questions. Best, Kristen From Mr. Wright: The problems facing bond investments, while not unprecedented, is certainly extremely rare. The type of risk we usually work with is non-systemic risk. Today, we are dealing with systemic risk, which cannot be diversified away. Municipal Bonds are issued by many different types of entities and purposes. Hospitals, universities, high schools, roads and bridges, cities, counties, water facilities, energy facilities, sewers, and issues by states based on future receipts such as tobacco bonds to name a few. All of these purposes carry varying risk levels which can fluctuate over time. Causes for Lower Municipal Bond Values 1. Deleveraging. This largely impacted corporate debt. Assets sold to bring financial ratios on balance sheets in line. 2. A
