CelloMom On Cars"We found clear evidence of a '#BlackTax' in the #MunicipalBond market, that cannot be explained by bond structure, bond rating, or socioeconomics. We also found that #ClimateRisk is not yet priced in the market, and together these findings point to a greater burden that communities of color face in paying for #climate resilience, even without a current climate risk pricing signal."
https://www.sciencedaily.com/releases/2023/08/230809164657.htm
US municipal bond market pricing may be biased by race, unphased by climate risk: Communities with larger shares of Black residents pay more in bond insurance costs, while those with higher physical climate risk do not
New research suggests that the US municipal bond market systemically misprices risk, as the pricing of municipal debt does not account for local physical climate risk, but does demand larger credit spreads from communities with a larger proportion of Black residents.
