Forward Earnings Are Bound To Get Much, Much Worse

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Quote from ByLoSellHi:

There are only two risks you're taking AFAIK, not that they're completely harmless:

1) Default (addressed previously; statistically FAR less likely than corporate bonds, or anything but treasuries - maybe 1% in the worse case scenario, maybe 2% [that's got to be a stretch given taxation powers]);

2) Inflation, but I hardly see that any time soon, as money just pours into treasuries given the desire to simply preserve capital. Treasuries are basically cash, now. There's risk, there, too. The tax exempt status of munis hedges against even this risk.

There's going to be risk in anything - even treasuries, right?

Yeah there's price risk in all, I agree. It's just that the chain of events you are forecasting would tend to lead munis to drop in price (due to fear of end of the world being nigh - downgrades, defaults, lower tax revenues etc) and Treasuries to increase in price (flight to quality, deflation). So to express your view, I think govt bonds are best.