“MUNICIPAL BONDS: THE ORIGINAL IMPACT INVESTMENT?”
For this first WA episode, I spoke with Matt Posner the Director of the Impact Coalition. We attack a bunch of topics centered around the emergence of the municipal bond markets’ increased relevance in the impact investing world. Matt is helping to coordinate through the efforts of the Impact Coalition.
THE IMPACT COALITION (www.theimpactcoalition.com) is working with the largest underwriters, investors, and state and local governments to build a new language to analyze public infrastructure projects. The Coalition allows market practitioners to have a universally recognized Social Rate of Return on projects that improve the daily lives of our communities, and as a result, lower the costs for those that are raising funds for the public good.
Matt has spent the last 15 years analyzing the intersection of public policy, financial markets and state and local governments. Prior to the Impact Coalition, Matt was Head of Market Strategy for a venture-backed start-up aiming to modernize public finance through technological advances, called Neighborly. During his tenure there, the firm successfully raised a Series A round and started an asset-management firm with a focus on socially responsible investing. It was during this time that Matt dove into the impact space and realized its true potential to help make positive community changes around the world.
Prior to Neighborly, Matt started a consulting and research firm, Court Street Group, which provides weekly analysis of public finance along with several municipal bond market veterans. He is an Advisor to that company and writes for them. He began his career writing about Nuclear Energy and was a Managing Director at a boutique public finance research firm, Municipal Market Advisors.
Matt has testified before the U.S. Senate Committee on Finance on infrastructure finance problems facing the country and spent years educating staff in the U.S. House of Representatives, the U.S. Senate, the U.S. Treasury Department and the Securities and Exchange Commission, among others, on public policy and market implications. Matt has been quoted on his views and published in the Wall Street Journal, the New York Times, Bloomberg News, The Bond Buyer, the Municipal Finance Journal, and the Government Finance Officers Association’s Government Finance Review, among others.
Matt doesn’t lack for international experience! He spent most of his childhood abroad in Senegal, The Gambia, Bolivia and Peru. He is a graduate of Georgetown University with degrees in Government and History.
The format of our discussion is below.
- Tell us a little bit about your background
- How did your career evolve?
The Impact Coalition:
- What problem was it formed to solve? Why do we need a new language for public infrastructure?
- What does it do?
- Who is a part of it?
Various issues in the Municipal Space
- Vast number of public issues
- Some universal language, some language particular to state law
- Problems with indexing
- Intensive manual reading and credit analysis
- Predicting interest rates
- Different levels of information
- Emerging technology AI, ML
- Active v. Passive Management
How would the IC’s work help the RIA community?
- What is there problem in dealing with clients fixed income needs?
- Fixed income ignored?
- Difficult to tell the fixed income story?
- Difficult to tell the ESG story? Municipals: The Original Impact Investment?
- Munis simply a tax free income play or something more?
- Tech issues
International Investing community
- Confused by lack of universal vernacular around public infrastructure
- Interest in infrastructure- unsure about “impact”
- Little experience in munis- Americans have long retail history- don’t understand the disconnect
- Grappling with increasing interest rates?
- Better to go with high dividend equity infrastructure on after tax basis?
- How do we keep track of the Impact Coalition’s progress? (www.theimpactcoalition.com)
- How do we keep track of your whereabouts?
Some quick news which you all probably guessed: the Frazer Rice podcast has been rebranded “Wealth, Actually” to align with my new book on the issues around wealth management. And don’t forget about “Wealth, Actually” the book: