But it can all go awry when someone starts arguing against derivatives and just gets it wrong. It makes us do a sad, frowny face and then get incredibly frustrated.

Well, as we noted at the time, it’s important to be clear about what we mean by “Harrisburg”. A synechdoche is a slippery thing. Linda Thompson, the city’s mayor, on Monday requested an expedited hearing to try and block the city council’s bankruptcy filing.

From Reuters on Wednesday morning:

As the FT’s Nicole Bullock reminds us, the bank is — or at least was — intimately involved with the municipal bond market.

In our opinion, it’s not as perceptive as his articles on Greece or Ireland but it’s still worth an Instapaper click.

Moody’s Tuesday action was forewarned last week when it placed the US sovereign’s AAA rating on review for possible downgrade. The credit rating agencies are busy at the moment, working out the consequences of any sovereign action on the thousands of securities directly or indirectly linked to the hub of the global bond market.

Wednesday’s WSJ has an interesting article on covenants that banks are attaching to direct loans made to municipalities seeking refuge from the capital markets. (The Bond Buyer reported back in February on the move toward direct lending.)

As widely reported this morning, the rating agency reviewed the National Audit Office’s report on local government debt and concluded that it underestimates banks’ NPL exposure.

Let’s get the quirky stuff out of the way first. The Israeli bonds, we think, are USAID bonds issued by the State of Israel in the early 2000s and fully guaranteed by the USA. The Egyptian bond is another US-guaranteed issue apparently done earlier this year in an effort to plug Egypt’s budget gap after the spring uprising.