And we're going to see big increases in the development of local bond markets, for example.
Since around 2010 or so, the general concern over massive state and local bond defaults has waned.
One Russian security many in the market are waiting for the Russian OFZ local bond, expected to be liberalized this year.
If all goes swimmingly well, the Russian local bond market will be easier for foreigners to access starting as early as July 1, 2012.
If Japanese investors were to repatriate that money sitting in Brazilian debt, it would cause the Brazilian real to weaken and Brazilian local bond prices to decline.
Easier access to the Russian local bond market is expected to result in a gradual increase of foreign investor inflows this year thanks to yield hungry money managers.
Homeowners need to recognize that when they vote for a local bond deal or tax rate increase, the resulting financial debt burden may ultimately fall on their children.
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Treat state and local bond interest as taxable.
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However, the correlation between flows into hard-currency bond funds and both local-currency bond funds and equity funds has decreased significantly lately, while the correlation between EM equity fund flows and EM local-currency bond fund flows has trended higher.
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For example, the Market Vectors Emerging Markets Local Currency Bond (EMLC) ETF is down 7.8% year-to-date.
For local currency bond holders, Brazil offers some of the best investment grade yield around.
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He holds emerging market equities through the Vanguard MSCI Emerging Markets Index (VWO) ETF and emerging market local currency bond funds.
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Future local currency bond issues in Brazil are going to pay a lot less in interest than they have in several years.
On July 23rd the firm introduced Market Vectors Emerging Markets Local Currency Bond ETF ( EMLC), a fund whose name describes exactly what it does.
The Market Vectors Local Currency EM Bond (EMLC) fund is down 1.4% by comparison.
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Also, local governments put bond issues on the ballot to borrow money for various reasons.
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Indian banking stocks surged after Moody's unified India's foreign and local currency government bond ratings at Baa3 and left ratings of government-related issuers unchanged.
To get a sense of what Brazil yields are like, the January 2015 local currency government bond yielded 12.8% in the March 17 Brazilian Treasury auction.
As a result, both local and hard currency bond funds continue to see the bulk of the inflows as investors consider them to be the safer bet over equities.
Without backing from a top-rated bond insurer, local governments and companies would have to pay more to finance projects.
The iShares 3-7Yr UST (IEI) exchange traded fund is up 6.68% while the Market Vectors Emerging Markets Local Currency (EMLC) bond ETF is up just 1.62%.
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The new bond will allow local governments or even citizen groups to submit proposals for purchases that would be eligible for matching private and federal funds.
But most of the investors choosing emerging market debt are buying bond funds with local currency debt, rather than buying the sovereign or quasi-sovereign dollar denominated bonds that foreign countries like Brazil also issue.
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If, for example, someone has signed a petition calling for a bond issue to finance local schools, a candidate might tell him that his opponent will cut spending on education.
As the Expos point out, local taxpayers, or at best bond-buyers, have paid 80% of the costs of the dozen big ballparks built in the United States in the past decade.
In local markets, Kantor favors selective nominal bond longs (high conviction in India, South Africa, and Mexico).
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Oppenheimer mutual fund bond manager Sara Zervos likes local currency emerging market bonds.
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The government-bond market is dominated by local banks and insurance firms which are forced to buy thanks to liquidity and solvency rules.
At the time, the SEC had the authority to bring anti-fraud actions after investors lost money but had no power to require full disclosure from state and local governments to enlighten investors about prospective bond offerings.
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Forcing bond insurers to hold exposure to credit derivatives while ceding good liabilities like municipal bond insurance would swamp their already over-leveraged capital bases, but save municipal bond investors, taxpayers and local governments from further losses, Spitzer said.
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