"Just how much should most Americans worry that some state and local governments could go into default? That's what a team of researchers from the Federal Reserve Banks of Cleveland and Atlanta has been studying over the past year. The Municipal Financial Monitoring Team has been looking at how shocks to the municipal bond market, continued problems with pension funding, and general fiscal stress could ripple into something much larger -- either in the form of a (rather unlikely) threat to financial stability or perhaps as an aggravation of regional economic woes."  MORE >>