Home      Login

Abstract: 

Since 1992, the Municipal Finance Journal has published edited proceedings from the annual conference of the National Federation of Municipal Analysts (NFMA). As the leading organization of municipal bond experts, the NFMA presents sessions with generous details on issues important to the functioning of this dynamic capital market. In this issue of MFJ , we offer selections from the 2011 annual conference held in Charleston, South Carolina. Subjects covered at the conference included such hot topics as market regulation, public pension liabilities, municipal defaults and bankruptcies, and headline risk. The keynote address was by the Honorable Elisse Walter, commissioner of the U.S. Securities and Exchange Commission (SEC). Commissioner Walter describes the current regulatory framework for the municipal securities market and offers insights on future steps to improve this market. Commissioner Walter’s perspectives are particularly important given her role as the commissioner presiding over the SEC field hearings where market experts, analysts, and investors explored a range of issues involving municipal securities. A recurring feature of the NFMA conference is a roundtable discussion by various market participants on the state of the market. Joining Commissioner Walter on the roundtable were the executive director of the Municipal Securities Rulemaking Board, Lynnette Kelly, bond lawyer John M. McNally, state finance chief Frank Hoadley, and, as moderator, wealth manager Greg Clark. This session offers an exchange of views and concerns by regulators and industry representatives on the contemporary function and issues facing the municipal market. Municipal securities became front page news in the leading newspapers and the lead stories on television news shows on the heels of a stark (and erroneous) prediction of widespread bond defaults by an equity analyst with no known experience in the municipal market. The NFMA hosted a session featuring journalists Jeannette Neumann from the Wall Street Journal and Mary Williams Walsh of the New York Times , both of whom have written insightful pieces on this market. Given the nature of headline risk, this panel was of particular interest, and it was enhanced by the participation of asset manager Bill Oliver and investment advisor Adam Mackey. During the year, a few events and many headlines focused on municipal bond defaults and bankruptcies. In a panel moderated by credit analyst Anne Van Praagh, details on the law and practice were provided by attorneys Marc Levinson, Michael H. Goldstein, Leon R. Barson, and Stanley McGuffin. These experienced lawyers reviewed particular cases and offered guidance relevant to analysts, market makers, and issuers. Public pension liabilities emerged as political fodder as well as a sincere fiscal concern. Natalie R. Cohen, a long-standing market analyst, moderated a panel that included pension system researchers Keith Brainard and Jean-Pierre Aubry, and attorney Philip Abelson. Panel members clarified fiscal facts and sticky solutions.

Keywords: SEC; Market Reform; Media Coverage of Municipal Finance; Public Pensions; Municipal Default and Bankruptcy

Affiliations:  1: Georgia State University.