Municipal Bonds Freeze Up

Interest payments soar for cities and counties, some of which loaded up on complex derivative deals similar to ones that swamped many banks

Like other credit markets, municipal bonds are nearly frozen. During the week of Sept. 22, three significant bond deals were done. Normally the tally would be about 100. Those that are getting done—like New York City's Sept. 29 deal—are high-priced.

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