For example, the Detroit Water and Sewerage Department (DWSD) paid $547 million in termination fees to banks on its interest rate swaps in FY 2012. It has been estimated that more than 40 percent of Detroiters' water bills now go toward paying down these termination fees. Fn. omitted.
According to the MSRB, this means that they "must not misrepresent or omit the facts, risks, potential benefits, or other material information about municipal securities activities undertaken with the municipal issuer."25 This means that they must ensure that public officials truly understand the risks of the deals they enter into and may not downplay the risks associated with those deals or mislead public officials about the likelihood of such risks materializing.
The most common contract defenses are duress, unconscionability, incapacity, fraud, and the "basic assumption" defenses of mutual mistake, unilateral mistake, impossibility, frustration of purpose and commercial impracticability. Fn omitted.
Interest rates are closely tied to the Fed Funds rate, and to people’s expectations about the interest rate policies of the Fed. Here’s a chart showing the Fed Funds rate since 1954.