“Only when the tide goes out do you discover who’s been swimming naked” – Warren Buffet

The tide has gone out on the municipal finance market.

While much of the discussion about the financial fall-out of the COVID-19 virus has focused on the massive wealth destruction in stock markets and pressure on corporates around the world, the impact on the largest financial market in the world- the $3 trillion US municipal finance market- cannot be ignored. Simply put, the market is imploding.

The Australian Government is proposing to constrain certain "ipso facto" clauses ‒ a move which could make flip clauses void. The closing date for submissions is Friday 27 May 2016.

How would changes to ipso facto clauses affect securitisation?