"There have been six or seven municipal bankruptcies already," Dimon said on Tuesday at an annual health-care conference sponsored by JPMorgan in San Francisco. "I think unfortunately you will see more."
He added that: "If you are an investor in municipals you should be very, very careful."
Fears have risen in recent months about defaults in the municipal-bond market, as states, cities and towns face huge budget gaps. Unemployment and the economic slowdown have left them with less tax revenue, forcing big cuts in service or tax hikes to make ends meet. California, New Jersey and Illinois are among the states with big budget issues, while Harrisburg, Penn., and Detroit are among the troubled cities. Lots of cities are expected to be unable to meet obligations if they can't tighten their belts within the next few months.Dimon isn't the first financial big-wig to cite concern about the municipal bond market. But as head of one of the largest banks in the country warning about additional defaults, his comments carry weight. -- Written by Lauren Tara LaCapra in New York.
>To contact the writer of this article, click here: Lauren Tara LaCapra. >To follow the writer on Twitter, go to http://twitter.com/laurenlacapra. >To submit a news tip, send an email to: firstname.lastname@example.org.
|TheStreet Tools * Ex-Dividend Date Calendar|
|* Top-Rated Stocks|
|* Highest-Yielding Stocks|
|* 2011 Earnings Calendar|
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV