John Maynard Keynes’ theory of the “paradox of thrift” is
premised on the assumption that saving cash, while advantageous
to the individual, is economically detrimental.  Hoarding money
is seen as damaging because it keeps liquidity out of the
market, yet the hundreds of thousands of people that graduate
college every year that want to become fiscally conservative
still rely on the practice. With the number of different
financial instruments available, rather than putting their money
into run-of-the-mill bank savings accounts and certificates of
deposit (CDs), these new savers are choosing securities that are
safe but still have the potential to grow in a shorter amount of
time. Enter the tax-free municipal bond. Before discussing the
contours of the instrument itself, imagine the following
hypothetical situation in November 2007. A recent graduate moves
out of his parents’ house and into a new apartment in Manhattan.
The savings in his checking account needs to be shifted over to
an instrument where the mone