Municipal bonds are issued by state and local governments to raise money. General obligation (“GO”) bonds, the safest type…
Municipal bonds are issued by state and local governments to raise money. General obligation (“GO”) bonds, the safest type, pay lenders from tax revenues. Revenue bonds are used to finance specific projects like a stadium or highway and lenders are paid from the revenues that the project generates. Since states cannot declare bankruptcy and it’s extremely rare for a city to do so, municipal bonds tend to be safe investments, especially considering that a local government can always raise taxes to pay back GO bond investors. Municipal bonds pay higher interest rates than Treasury securities and pay about the same that a risky corporate bond would pay.
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About Mike Periu
Mike is a seasoned executive with experience in small business finance and management. He is the founder of Proximo, LLC a leading provider of corporate, consumer and small business education and training services with an emphasis on finance and technology.
Mike Periu is also a leading national voice for individual empowerment through financial education and entrepreneurship. He has been interviewed over 500 times in national and international media, including NBC, Univision, CNN en español, Telemundo, HITN, TVE, RTE, SBS, MegaTV and others.
Mike writes regularly for American Express OpenForum, Yahoo! Finanzas and is a Huffington Post contributor.
Mike has degrees in Finance and International Business from Georgetown University. He is on the Board of Directors of the Council for Economic Education and was a Fellow at the Kauffman Foundation’s Labs for Enterprise Creation.
