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[QUOTE]Originally posted by Gilbert B Norman: [QB] This article, appearing in Today's [URL=https://www.wsj.com/articles/risky-municipal-bonds-are-on-a-hot-streak-11558949401]Wall Street Journal[/URL] gives insight, as well as mention, regarding the successful underwriting of the "junk". Apparently, in search of yield, institutional investors are willing to take a high risk of default: Fair Use: [i][list] [*]Virgin Trains U.S.A., backed by Fortress Investment Group, has benefited from high demand for munis. Also known as Brightline, the train seeks to connect Orlando, Fla., to Miami. But it didn’t fill up its trains with as many passengers as expected in 2018 after station opening delays, according to bond-offering and financial documents. The company also faced losses, financial records show. A spokesman for the train said it had always projected a “multiyear ramp-up” for revenue and ridership. Even so, in April, muni investors lent Virgin about $1.8 billion to expand, marking the largest unrated muni bond deal over the past five years, according to calculations by MMA. Brian Wynne, head of public finance at Morgan Stanley , which underwrote the bonds, said high demand enabled the railway to sell $250 million more in debt than initially planned, with yields roughly a fifth of a percentage point less than expected. Virgin could issue $950 million more in the coming months, according to the Florida Development Finance Corporation. Such bonds “enable the private sector to deliver critical infrastructure projects,” said Wes Edens, co-chief executive of Fortress and Chairman of Virgin Trains..[/i] [/list] Promise; you won't find these "puppies" in my portfolio. [/QB][/QUOTE]
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