Unable to afford access to traditional financial services, the underbanked have been historically overlooked by lending institutions due to their higher risk profile and lower perceived profitability.

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Yet when we adjust for the risks of default we find that munis have much higher prices (lower yields) then the risk profile would lead us to think they should.

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In response, Robinson argues that any Chinese firm that is denied access to the U.S. markets would automatically acquire an elevated risk profile, and thus would pay a higher cost for raising funds elsewhere.

CENTERFORSECURITYPOLICY: Center for Security Policy | Lehman��s Analyst Melcher Breaks The News For The Markets: China Must Clean Up Its Act �� or Search Elsewhere For Much-Needed Capital