Won't really react much since this isn't a municipal bond fund. We are mainly interested in interest rates.
But I really do feel for Michigan. I don't want to hear its all because of unions either. Just take a look at pensions of governors, mgrs....etc. If you recall the GM of GMC who O'Bama fired not only gets a beautiful pension, but got a HUGE severance pay. Lets face it, jobs are/have been leaving the country which not only hurts the employer but the stores they bought from too.
This is not a unique problem for Detroit. The government for decades has substituted decent pay with the promise of pensions. Now with people living much longer it is simply too much for them to fund. This is also true with many large corporations. Boeing GM etc. The actuaries never adjusted properly for longevity, and now they can't pay for it. A horrible problem for the retirees as they will be the ones to lose in the end instead of executives or government officials.
There should not be any public unions IMHO. Detroit won't be the last city to file. City employees should not get to retire with average pensions of 5k a month and full medical benefit at age 50. I can't fault them for negotiating such contracts. Blame the politicians for this game they played for power...50 years or more of liberalism killed this city but it will come back. BTW good to see PTTRX recovering.. we knew it would..