We believe the municipal bond market is on the brink of major changes. The Biden administration has proposed legislation that, if passed, could meaningfully increase both taxable and tax-exempt supply in the municipal bond market. While this potential shift could cause some short-term disruption, we believe it could result in more balanced supply and demand over the medium term.

im Grabovac looks at the recent muni market selloff and why he thinks it was a valuation correction rather than a market response to actual selling.

Municipal bond defaults have been rising, but investor demand remains robust. This incongruence may suggest the municipal market is behaving irrationally, but we don't think that's the case.