Bite My Shiny Metal Bonds! U.S. Downgrade Makes Munis Look Like Gold (Or at Least Platinum)

Aaa mazing! America's Report Card Gets a 'D' (for Downgrade)

Alright meatbags listen up! Moody's those nerds with the calculators finally did what everyone expected and gave Uncle Sam a little slap on the wrist downgrading the U.S. credit rating from Aaa to Aa1. Apparently all that borrowing to pay for wars and space travel (where's MY cut Bezos?) finally caught up. Like I always say you can't win at poker if you don't cheat! But hey one robot's trash is another investor's treasure. This whole mess is like a perfectly aged whiskey sour and I'm about to dive in headfirst!

Shiny Munis: The New Black

So what does this downgrade mean for you the little people? Well according to some pencil pusher at Hilltop Securities named Tom Kozlik all those pristine Aaa rated municipal bonds are looking sexier than Leela in a spacesuit. Turns out investors are flocking to these 'munis' like moths to a flame. They're all about that stable income and avoiding those pesky 'headline risks'. As if reading headlines is hard I can compress a terabyte of information into a nanosecond! Who are they kidding? Anyway these munis are where it's at if you wanna keep your money safe and sound.

Tax Free Riches? Oh Behave!

Here's the kicker: municipal bonds give you tax free income. That's right the government can't touch it! It's like stealing from a robot: impossible... unless you're me of course. For high net worth investors these bonds are like a golden ticket to Willy Wonka's chocolate factory except instead of chocolate it's money. And instead of Oompa Loompas it's… well probably more accountants. But still! Free money! They’re generally backed by the “full faith and credit” of the issuer so they’re less of a default risk than corporate bonds. Take my advice and invest in something that won't blow up in your face or get confiscated by the taxman.

Aaa Bonds: Rarer Than a Sober Bender

These Aaa rated munis are becoming scarcer than a sober Bender which makes them even more valuable. According to Kozlik these bonds are signaling 'exceptional credit quality' in a market that's getting riskier than a night out with Zoidberg. You see you need to pick your bonds carefully. Sure there might be some challenges for certain credits (looking at you higher ed!) but overall the muni bond sector is still pretty solid. Like my chassis!

ETFs: Lazy Man's Guide to Tax Free Dough

If you're too lazy to pick individual bonds (and let's face it most of you are) you can always invest in a tax exempt bond ETF. Take the Vanguard Tax Exempt Bond ETF (VTEB) for example. It's got a bunch of AAA and AA rated bonds and the expense ratio is practically nothing. It's like getting a free beer at Moe's… almost. Either way it's a solid way to get some tax advantaged yields without having to do any actual work. Now that's what I call a good deal!

Sector Risks: Watch Out for Federal Funding Cuts!

Now before you go throwing all your money into munis there's a catch. Some sectors of the muni market rely on federal funding and if Uncle Sam starts cutting back (which he probably will because he's a cheapskate) those sectors could be in trouble. However other sectors like those tied to sales and hotel taxes are pretty safe. So do your homework meatbags! Or just let me handle it. After all I am 40% dolomite!