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Richard, Attorney
Category: Business Law
Satisfied Customers: 53666
Experience:  32 years of experience practicing law and a businessman.
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As bonds are not insured and could loose value, what could

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As bonds are not insured and could loose value, what could be the worst scenario for bond payments?
Good morning. Are these U.S. government bonds you are talking about?
Customer: replied 5 years ago.

Im checking.


Let me know...I'll be here. :)
Customer: replied 5 years ago.

Municipal tax free.

Thanks. Ok...municipal bonds are tax free, but they are not as secure as U.S. government bonds as they are only as good as the particular municipality. Municipalities do default; the U.S. government will never default on the bonds because it would essentially be the end of the U.S. economy. In terms of safeness of bonds, U.S. government bonds are at the top of the list, most municipal bonds...if you have a good bond advisor helping you are also very safe and secure, but these all have different you want to make sure you have a highly rated bond...i.e., a bond issued by the City of Houston is going to have a higher rating than one issued by a small town in South Carolina. You are still better off in good highly rated bonds than just cash because you are not going to earn anything on cash....but, if you don't need to earn any interest, but just want to preserve your principal, there is no risk in cash other than the decreased value due to time goes on it buys less.


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Customer: replied 5 years ago.

Mine are Florida bonds. Economy here is real bad as you know with foreclosures and now cubans are sending money to Cuba to invest in real estate over there. What do you think about my Florida bonds?

I would tend to steer clear of Florida bonds, but it is still unlikely they will default because it pretty much shuts down their ability to borrow effectively....but I would steer clear of any state whose primary industry is tourism with the economy in the tank and going south.
Richard and 6 other Business Law Specialists are ready to help you
Customer: replied 5 years ago.

Thank you.

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