hi pic, seems you are spot on. trouble in muni land. might eventually be the straw that breaks the back of the camel/fed in default. more trouble coming.

SEC Probing Disclosures Of Muni Bond Prospectuses

http://www.zerohedge.com/article/sec-probing-disclosures-muni-bond-prospectuses

Adding insult to injury for holders of muni bonds, whose assets have plunged in value in the past month, pretty much as expected in light of pervasive state insolvency which is no longer being masked by the government's generous "Build America Bonds" distraction, is Charlie Gasparino's breaking news that now the SEC has gotten into the fray, and is looking into muni bond prospectus disclosures. Per Gasparino: "What they are looking at whether municipalities, cities and states, are adequately disclosing their budget woes to investors who buy these bonds." Which only means that as the risk of further pervasive impropriety is unearthed, and the muni space ends up being as much of a fraud as the MBS one, that the risk of holding on to MUB-derivative equivalents will only get higher, leading to yet another round of sell offs now that the muni bond situation has entered a toxic spiral where, in the inverse of the stock market, any news creates merely greater selling pressure.

From Fox Business' Gasparino:

“The SEC is ramping up a probe into troubled muni bonds. Sources are telling the FOX Business Network they are looking at disclosures made in the bond documents, they are known on Wall Street as prospectuses. What they are looking at whether municipalities, cities and states, are adequately disclosing their budget woes to investors who buy these bonds. More than any other investment, muni bonds are held by retail investors; average people looking to cash in on the triple tax free status. That’s why the SEC is concerned.”