Robert Kurtter, Moody's public finance managing director:
Credit stress is real in the muni sector. State and local government are facing unprecedented credit stress. The Great Recession is over. The recovery is tepid. State and local governments are lagging. And with the demise of the federal fiscal stimulus, 2011 is going to be a very stressful year for state and local government.
To be honest, these problems are broad-spread across the country. There isn't anywhere that is exempt from these problems.
We don't see any state governments defaulting. We don't see any large rated cities or counties across the country defaulting, [but] two-thirds of the issuers in the muni-market are unrated [and] they're small; they're weak.
[Moody's] believes that the problem is messy, but manageable.