Obama Proposals Would Hit Municipal Bonds With A Tax Double Whammy

In today’s zero interest rate environment, income investors are running out of options.  Yields on treasuries have been compressed to historic lows.  Bank CDs and deposit accounts aren’t generating enough income to cover account maintenance costs.  And equity positions that pay dividends are becoming more risky as the economy stumbles.

By Richard Shaw (QVM Group): There is a new move afoot in Washington to limit the tax advantages of municipal bonds.

Here's a Canadian perspective from Jack Mintz on Warren Buffett's proposal that the "billionaire-friendly Congress" stop coddling him and his friends by raising tax rates on the "mega-rich":

Richard Shaw (QVM Group) submits: Bonds in the US are generally unattractive at this time, because rates are bound to rise, harming the market value of the bonds. Rate rises are slow in coming and may yet be delayed, but much of the rest of the world is raising rates.

There's been a lot of back-and-forth recently over the fact that almost half of all Americans pay no Federal income tax.  Conservatives trumpet this as evidence that we're too focused on taxing the rich; liberals retort that the poor often pay heavy payroll taxes, and anyway, the rich make more of the income.Who's right?  To my mind, they both are.  Or perhaps, both wrong.

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.

By StreetAuthority: By Michael Vodicka When billionaire bond manager Bill Gross speaks, investors listen.