Rule 15 of 32 in this unit2.1.2
2.1.2 Debt Instruments
SIE outline 2.1.2
Backed by Taxing Power
Secured by full faith and credit. Of an issuer that can tax. Which is why the levy can be compelled. NOT backed by any particular project.
The trick
Common trap: Full faith and credit means the U.S. government. Correct: For a municipal bond it means the issuer's own tax base. Ask whose credit is pledged.
The method for this kind of question
- Municipal rules return in Section 4
Now answer
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its other screens and on its practice page, and more arrive as the bank grows.
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