Day 4

Today at nine o'clock Mr. Dorflinger assigned me the hardest section of debt, municipal debt. This section was so long that I could not even finish it. The municipal section opened with introducing me to two of the main kinds of municipal debt, general obligation bonds (G.O bonds) and revenue bonds. G.O bonds are backed by the full faith, credit, and taxing power of the municipality, typically ad valorem taxes. Revenue bonds use their proceeds to build revenue producing facilities. After learning about the tier one bonds in municipal debt I took a lunch break. When I returned from lunch I read about the last kind of municipal bond known as a special tax bond. Some examples of special tax bonds are build America bonds, moral obligation bonds, and double barreled bonds. Municipal debt is also issued in short term notes, such as tax and revenue anticipation notes.