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    municipal bond rating services

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    What are the main criticisms that have been levelled against municipal bond rating services? What are the advantages and disadvnatages of replacing the present services with one done by a Federal agency?

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    First let us begin by defining what a municipal bond is. Municipal bonds are are debt obligations of state and local governments. Moody's classifications signify the following: Aaa -best quality; Aa -high quality; A -upper medium grade; Baa -medium grade (some speculative characteristics); Ba -characterized by uncertainty; B -lacks characteristics of desirable investments; Caa -poor standing; Ca -speculative to a high degree; C -lowest rated class of bonds.
    <br>The two main bond rating firms are Moody's and Standard and Poors--the ratings provided are bases on the creditworthiness of the issuer. Note: bond rating are concerned ONLY with the possibility of default. Municipal bonds are rated in the same manner as corporate bonds because they have varying ...

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    Municipal bond rating services are assessed.