State of the States.

The article discusses the impact of high pension shortfalls and high debt on the risk for state municipal bond investors. States like Illinois, Connecticut, and Hawaii are said to be confused by large unfunded pension liabilities from weak investment returns. Berkshire Hathaway disclosed that it had ended municipal derivatives contracts. It was noted that the risk of investing in the debt of some of the least financially sound states is not always manifested in the price of their bonds.