Don't Sweat Municipal Bond Defaults, Altucher Says

Infinite QE ensures that municipal debt, like Greece, will not default. Sweeping the problem under the rug using infinite QE does not solve it. Local government will still be forced to cut back services, reduce spending, and/or raise taxes. Citizens, subject to deteriorating standard of livings within a system that they (and their children's money) have "saved", might not be so willing to accept these options. This is why the government is so eager to show/window dress the huge profits made from the Citi bailout.

Tax revolt? Instead of default, more likely scenarios for local governments include selling assets, cutting spending and raising taxes. Of course, that in turn could spark social unrest, as Aaron notes in the accompanying clip. But we're not there yet, says Altucher, adding that any incremental improvement in the economy will translate into more revenue for local coffers.