infrastructure play - port authority of ny to pay 20% on bonds

[jk]

Auction-Bond Failures Roil Munis, Pushing Rates Up (Update1)
By Martin Z. Braun
Feb. 13 (Bloomberg) -- A wave of bonds sold by U.S. municipal borrowers with rates set through periodic auctions failed to attract enough buyers in recent days as banks including Goldman Sachs Group Inc. and Citigroup Inc. that run the bidding wouldn't commit their own capital to the debt.
Rates on $100 million of bonds sold by the Port Authority of New York and New Jersey, with bidding run by Goldman, soared to 20 percent yesterday from 4.3 percent a week ago, according to data compiled by Bloomberg. Presbyterian Healthcare in Albuquerque and New York state's Metropolitan Transportation Authority also experienced failures, officials said.... [emphasis added]



talk about INFRASTRUCTURE! the port authority of new york controls all the bridges and tunnels as well as the airports around nyc. they have a very good revenue stream. and they have to pay 20%!




http://www.bloomberg.com/apps/news?p...QBg&refer=home

[rtchoke]

Re: infrastructure play - port authority of ny to pay 20% on bonds

Are these available to Joe Public? How so?

[dbarberic]

Re: infrastructure play - port authority of ny to pay 20% on bonds

Are these available to Joe Public? How so?

Yes.... I want in on this action....

[jk]

Re: infrastructure play - port authority of ny to pay 20% on bonds

fyi from a comment at russ winter's blog:

Unless you really need the cash NOW, this whole auction rate “crisis” is not a crisis at all but a great opportunity — again, assuming you do not have immediate cash needs. I just picked up some of these auction rate monkey’s via my Fidelity account this AM. Rates ranging from 9-14%. One downside is that most of the minimum purchases are $25,000 per order. When they reset lower I’ll dump them at par. If they don’t reset lower, then I’ll just hold them at the higher reset rate until they do. EZ-cheezy-japanezze!!

[Jim Nickerson]

Re: infrastructure play - port authority of ny to pay 20% on bonds

It once was that the higher the interest rates paid to borrow money; the higher was the risk to the one loaning it.

I guess we are past those days now.