A conversation between two professors in 2011 helped spark what is now the country’s largest annual gathering of municipal finance experts.
Co-founded by Dan Bergstresser, associate professor of finance at Brandeis International Business School (IBS), the Municipal Finance Conference brings leading academics, practitioners, issuers and regulators together every summer to compare research and discuss emerging trends in their field.
Bergstresser said the idea to hold a conference first came up during a discussion with Richard Ryffel, a municipal bond banker who at the time was a senior lecturer at Washington University’s Olin Business School.
“We were talking about our research,” said Bergstresser. “And we quickly realized how important it was to get everyone together — academics, state and local officials and regulators who all have a stake in this market. That was the genesis.”
A professor at Brandeis IBS since 2011, Bergstresser touched on his passion for municipal finance, the importance of academic rigor and more during a recent interview.
Why is municipal finance relevant to the general public?
Just look around your community. A large number of the physical things we rely on everyday — roads, schools, firehouses, hospitals — are financed in the municipal capital market. It’s about a $4 trillion market in the United States and it’s extremely important for financing the infrastructure that makes our society run.
What trends are you watching closely in this space?
The biggest trend worth following has to do with pensions. Over the last 60 years, the municipal bond market has been incredibly safe. From an investor’s perspective, the repayment rates are high and the default rates are very low. So it’s an asset that has performed well from a credit perspective. But there’s concern for the future. A lot of municipalities potentially have big problems on the horizon regarding the financing of pension and healthcare benefits for retired employees. This was a big part of what we saw in Puerto Rico and Detroit, and you’re starting to see it in places like Chicago, Hartford and elsewhere. This is a market where credit concerns are common but credit catastrophes don’t often materialize. There’s growing concern about that going forward.
Are you surprised by the success of the Municipal Finance Conference?
It’s a group effort. We couldn’t have achieved this without help from a lot of people at the Brookings Institution, Olin Business School, the University of Chicago Harris School of Public Policy and Brandeis IBS. I’d say the biggest benefit is we now have a regular forum where stakeholders can come together to discuss existing research or identify emerging issues that could use more research. It’s incredibly valuable.
What do you enjoy most about teaching at Brandeis IBS?
We have a diverse mix of students, so it’s fun to get to know people from different countries and learn from them. The coursework at Brandeis IBS is also quite rigorous. It’s important to build a technical tool kit that matches your aspirations — a real familiarity with various financial instruments, emerging technologies and a firm grasp of how to harness the power of data. I also think it’s important to apply these tools in a real business context, which is why I always try to blend my lectures with case studies to give students exposure to real-world applications of these ideas.
How do you spend your time outside the classroom?
When I’m not teaching at Brandeis IBS, you’ll probably find me near a baseball field. I’m a big Boston Red Sox fan — our family shares season tickets so we end up going to around 10 games at Fenway Park each season. I’m also a huge fan of the Harwich Mariners of the Cape Cod Baseball League. And my son also plays baseball and my daughter plays softball. So I’m always supporting my kids’ interest in the sport.