Build America Bonds to Save $12.3 Billion, Report Says

The following is a wonkish discussion of one aspect of the White House budget. The President’s budget will never see the light of day, but I think it is instructive to look at this component of the plan, and expose it for what it is – A fraud.

  The following is a wonkish discussion of one aspect of the White House budget. The President's budget will never see the light of day, but I think it is instructive to look at this component of the plan, and expose it for what it is - A fraud.

Stephen Yu submits:Lately, Build America Bonds (BAB) are like Rodney Dangerfield. They just get no respect. While stocks and commodities have soared since the end of August, BABs have stumbled.

Michael Johnston submits:State Street has partnered with Nuveen Investments to launch the SPDR Nuveen Barclays Capital Build America Bond ETF (BABS), the second ETF offering exposure to a corner of the bond market created as a result of the recent recession.

There was a $1 trillion gap at the end of fiscal year 2008 between the $2.35 trillion states had set aside to pay for employees’ retirement benefits and the $3.35 trillion price tag of those promises, according to a new report released by the Pew Center on the States. The shortfall, which will have to be paid over the next 30 years by state and local governments, amounts to more than $8,800 for every household in the United States.

Even as Congress remains at a budget impasse, President Barack Obama continues to tout his plans to increase federal investment in the nation's ailing infrastructure, a $50 billion initiative that the White House claims will spur job creation and economic growth.

Brian Rezny submits: Last week, scheduled municipal bond sales totaled $15.4 billion -- the most in seven years, according to Bloomberg. And why? Because local and state governments are racing the clock to take advantage of the Build America Bonds program. The plan, which provides a 35% federal subsidy on interest costs, is set to expire at the end of the year (issuance through the end of October totaled over $150 billion -- around 25% of municipal bond sales).

WASHINGTON (Reuters) - U.S.