Rockfleet | Reports

November 8, 2010

Sports Facility Financing: An Overview

There has been a boom in stadium and arena construction in the U.S. over the past two decades. Between 1989 and 2009, 103 of the 118 sports venues utilized by teams across five professional sport leagues (Major League Baseball, National Football League, National Basketball Association, National Hockey League, and Major League Soccer), were either newly built or had undergone major renovations. The total estimated construction costs for these facilities approached $27 billion.

Rating Agencies

October 18, 2010

Rating Agency Reform

Trust is key to the bond business, and trust is predicated on credibility. Relatively recent events in the asset backed security ("ABS") market shocked the financial system and focused attention on the failure of rating agencies to correctly assess risk. Unsophisticated investors lacking the specialized expertise necessary to assess an investment vehicle outsourced their responsibility to investigate and determine risk.

Pensions and OPEBs

October 11, 2010

State Pension Reform

States and local governments have needed to provide for their employees' retirements since 1935, when they were excluded from social security. In the 1950's, states could enter into voluntary, revocable agreements for coverage; however, these agreements became irrevocable in 1983. In 1991, social security coverage was mandated for all state and local government employees not covered by a public retirement system.

Budget

September 13, 2010

Illinois Budget Update

Most investors are aware of the severe budgetary problems many state and local governments are experiencing as the Great Recession wreaks havoc on their revenue bases. While California has garnered most of the attention due to the prominence of the state and the size and scope of its deficits, Illinois' budget issues now exceed those of California on a relative scale. Not only is Illinois confronting a $13 billion deficit for its current fiscal year, but the state is also dealing with a $6 billion backlog of unpaid bills and massive unfunded pension liabilities.

Tobacco Bonds

August 30, 2010

Tobacco Bonds: High Yield, High Risk

Because tobacco bonds are usually issued as tax-exempt securities and proceeds are used for general government purposes, they are classified as municipal bonds. Investors should be aware that most tobacco bonds are not backed by governmental funds, but rely solely on contractual payments from cigarette manufacturers for repayment. As such, tobacco bonds contain risks characteristic of corporate debt with added concerns such as the investment risk of cigarette consumption declines and ongoing litigation.