Muni bond defaults 2020 professional#

The 1873 panic and years of depression that followed put an abrupt but temporary halt to the rapid growth of municipal debt.

Smaller firms followed suit as well as the stock market. Around the same time, the largest bank of the country of the time, which was owned by the same investor as that of Northern Pacific, collapsed. Construction costs in 1873 for one of the largest transcontinental railroads, the Northern Pacific, closed down access to new capital. Railroads were private corporations and these bonds were very similar to today's industrial revenue bonds. Years after the American Civil War, significant local debt was issued to build railroads. The debt was used to finance both urban improvements and a growing system of public education. In the ensuing decades, rapid urban development demonstrated a correspondingly explosive growth in municipal debt. cities were in debt, and by 1843 cities had roughly $25 million in outstanding debt. Officially the first recorded municipal bond was a general obligation bond issued by the City of New York for a canal in 1812. municipal bonds indicate use around the early 1800s. Borrowing by American cities dates to the nineteenth century, and records of U.S. Municipal debt predates corporate debt by several centuries-the early Renaissance Italian city-states borrowed money from major banking families. 4.4 Default risk, credit ratings and insurance.Products and services may be provided in various countries by the subsidiaries and joint ventures of DWS.

Muni bond defaults 2020 professional#

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