Summary
- Municipal bonds are illiquid and tax-exempt and thus well targeted at very wealthy high-income individuals who face high tax rates.
- Given the racial disparity in wealth, it would be astounding if the disparity in municipal bond holding were not very large as well.
- To forestall a bankruptcy, you do not just lend money for current operations – you end up taking on past debts.
Seeking Alpha
Sep. 18, 2020