Friday, July 13, 2012

Buffett Says Muni Bankruptcies Set To Climb

Warren Buffett, the billionaire chairman of Berkshire Hathaway, said municipal bankruptcies are set to rise as there’s less stigma attached after three California cities opted to seek protection just weeks apart, reports Bloomberg.

“The stigma has probably been reduced when you get very sizeable cities like Stockton or San Bernardino to do it,” Buffett, 81, said in an interview today on “In the Loop with Betty Liu” on Bloomberg Television. “The very fact they do it makes it more likely.”

LOL. What's really going to cause cities to go bankrupt is that they have run out of money and they can't find any more suckers to buy their muni bonds. The cities have started things rolling, but it's not too long before some states start filing for bankruptcy.

You have to be a real idiot to own long-term munis now.