Unable to afford access to traditional financial services, the underbanked have been historically overlooked by lending institutions due to their higherriskprofile and lower perceived profitability.
Yet when we adjust for the risks of default we find that munis have much higher prices (lower yields) then the riskprofile would lead us to think they should.
In response, Robinson argues that any Chinese firm that is denied access to the U.S. markets would automatically acquire an elevated riskprofile, and thus would pay a higher cost for raising funds elsewhere.