Friday, September 4, 2015

Bernanke, Detroit delay Philly bond sale

Waiting for the right moment to price $400M

Bernanke, Detroit delay Philly bond sale


Philadelphia had hoped to sell nearly $400 million in new and refinanced general-obligation bonds last month. But after Federal Reserve chairman Ben Bernanke threatened to stop his massive purchase of federal government debt, provoking investors to dump muni funds on fear of lower rates, the city rescheduled..

New municipal bond issues, which had been pricing at roughly the same near-record low rates as U.S. Treasuries, suddenly rose to as much as 0.6 percentage points -- a big gap, with today’s low rates -- according to data posted by Municipal Market Adviser.

So Philadelphia postponed its borrowing until this coming Friday, hoping rates would slip back down. That started to happen -- until Detroit surprised investors by declaring bankruptcy, driving bond yields almost as high as June’s peak. On Thursday, city finance chief Rob DuBow said at least part of the bond sale would be postponed again.

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PhillyDeals posts drafts, transcripts and updates of Joseph N. DiStefano's columns and stories about Philly-area business, which he's been writing since 1989.

DiStefano studied economics, history and a little engineering at Penn and taught writing at St. Joseph's. He has written thousands of columns and articles for the Inquirer, Bloomberg and other media, wrote the book Comcasted, and raised six children with his wife, who is a saint.

Reach Joseph N. at,, 215.854.5194 or 302.652.2004.

Reach Joseph N. at or 215 854 5194.

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