Vanguard Holds Half of PG&E's $920M Municipal Bonds

The video discusses the involvement of active money and hedge funds in stocks, highlighting Vanguard's role in municipal bonds. It explains the backstop mechanism where banks act as insurers, noting the risks involved. Vanguard's position on bond sales and risk management is detailed, along with the role of banks and municipalities as backstops.

What is the role of banks in the context of the $415 million municipal bonds?

• They are the primary investors.

• They act as buyers of last resort.

• They are the regulators of the bonds.

• They are the issuers of the bonds.

According to the expert Taylor Riggs, how common is the backstop provided by banks for municipal bonds?

• It is a standard practice.

• It is a temporary measure.

• It is a rare occurrence.

• It is a new regulation.

What is the potential risk mentioned in the context of the backstop for municipal bonds?

• The bonds might lose value.

• The interest rates might increase.

• The bonds might be recalled.

• Someone will be financially responsible.

What action did Vanguard take regarding the municipal bonds?

• They insured the bonds.

• They sold down the bonds.

• They increased their holdings.

• They transferred the bonds to another fund.

Who typically acts as a backstop for municipal bonds, according to the discussion?

• Federal Government

• Municipalities or states

• Banks

• Private investors