Dan Seymour

The giant question mark of whether bankers will be able to find buyers for municipal bonds if and when they come in heartier supply continues to keep dealers sidelined, demand sickly and yields drifting up.

Retail investors in municipal bonds are shaken, but still standing, after a relentless barrage of forecasts of massive municipal bankruptcies and defaults this year.

Municipal bond mutual fund outflows continued to subside last week from recent record-setting levels as the cash most prone to panic appears to have left by now.

Investors established a record for withdrawals from municipal bond mutual funds last week as headline risk continued to chase people from state and local government debt funds.

Private wealth investors in retail municipal bonds have remained calm the past few months even as mutual funds have dumped state and local government debt by the truckload.

Most muni bond exchange-traded funds performed noticeably worse in the fourth quarter than the indexes they were designed to track.

Investors kept pulling cash from municipal bond mutual funds at a record pace last week as frightened money continued to flee the market.

The return of bank profitability, coupled with some of the provisions of the federal stimulus, coaxed banks to buy state and local government debt in the first half.

The Basel III bank capital requirements proposed earlier this month threaten to eviscerate the supply of eligible investments for tax-free money market funds — an industry already struggling with a severe supply shortage.

The unit investment trust has quietly blossomed into the dominant investing vehicle for Build America Bonds, the taxable municipal debt created under last year's stimulus legislation.

Closed-end funds devoted to stocks, bank loans and taxable bonds have taken a wild ride this year, but closed-end municipal bond funds have avoided the turbulence.

Investors pulled cash out of municipal bond mutual funds last week for just the third time in a year and a half, despite a strong week for state and local government debt.

Invesco PowerShares plans to roll out its second exchange-traded fund devoted to Build America Bonds, highlighting both the proliferation of municipal ETFs and the growing importance of taxable state and local government debt.

Charles Schwab Corp. has formed a partnership with Pacific Investment Management Co. to offer wealthy clients in or approaching retirement a managed municipal bond laddering product.