Tags: muni | bond

Evercore Partner: Muni Market’s Defaults ‘Isolated’

Wednesday, 02 Nov 2011 05:42 PM

Defaults in the $2.9 trillion municipal-bond market have been isolated and fewer than expected, said Gary Gildersleeve, a partner at Evercore Wealth Management in New York.

“You know what’s happened to Harrisburg, it’s an isolated event,” Gildersleeve said, referring to the Pennsylvania capital where the City Council voted to seek bankruptcy protection on Oct. 11. “There has been no widespread contagion in the municipal market.” He spoke on a panel at the State and Municipal Finance conference hosted by Bloomberg Link in New York.

Banking analyst Meredith Whitney’s prediction of “hundreds of billions of dollars” of defaults in a “60 Minutes” television interview in December proved unfounded. Instead, defaults fell to $1.1 billion, a quarter of 2010’s rate, according to Bank of America Merrill Lynch data.

Gildersleeve said his company has been looking past general obligations to revenue bonds.

“We’ve been emphasizing essential-service revenue bonds,” he said. “You can find some issues with some very, very dependable revenue streams.”

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Defaults in the $2.9 trillion municipal-bond market have been isolated and fewer than expected, said Gary Gildersleeve, a partner at Evercore Wealth Management in New York. You know what s happened to Harrisburg, it s an isolated event, Gildersleeve said, referring to...
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2011-42-02
Wednesday, 02 Nov 2011 05:42 PM
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