Illustration: Rebecca Zisser/Axios

It's been bonds, not stocks, that have drawn major investment this year and municipal bonds have attracted particularly large and consistent inflows.

What's happening: Thought of as a slow and sleepy asset class preferred by retirees and risk-intolerant savers, muni bonds saw record inflows during the first quarter.

  • The flows were spurred by the Tax Cut and Jobs Act, a reduction in muni issuance and the Fed's U-turn on interest rate policy, analysts say.

Details: Data from Lipper shows cash has flowed to munis every single week this year, and the asset class has seen cash inflows of more than $1 billion or more in 15 of the 20 weeks this year that Lipper tracks.

  • That has brought muni bond net fund inflows to $36.8 billion, already the 3rd largest annual net inflow ever for the muni bond fund group and the highest inflows this early in a year in nearly 3 decades.

"Taxpayers are experiencing the effects of the limit on SALT deductions, which in many cases are increasing tax bills," analysts at RBC Wealth Management wrote in a note to clients last month. "We anticipate tax-bill sticker shock could stoke additional demand for tax-exempt securities."

Why it matters: The asset flows show investors are eschewing risk. While equities have seen nearly $100 billion of outflows from mutual funds and ETFs so far this year, investors have pumped close to $150 billion into bonds, EPFR data shows.

  • "[M]any institutional investors today say they see taxable municipals as an attractive late-cycle asset class," Scott Sprauer and Robert Burke, municipal portfolio managers at investment firm MacKay Shields wrote recently for Pensions & Investments.
  • "With the U.S. economic recovery now longer than all but one in history, and the global economy still fragile, many of these investors welcome the higher credit quality and more reliable ratings stability of municipals vs. other fixed-income sectors."

Yes, but: Investors also have been chasing riskier munis in an effort to increase returns, pushing $8 billion into into high-yield muni bond funds, also known as junk munis, through the first 5 months of the year. That's the highest inflows through May since at least 1992, according to Lipper's data.

Go deeper: Everybody wants U.S. bonds

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Biden: The next president should decide on Ginsburg’s replacement

Joe Biden. Photo: Drew Angerer / Getty Images

Joe Biden is calling for the winner of November's presidential election to select Ruth Bader Ginsburg's replacement on the Supreme Court.

What he's saying: "[L]et me be clear: The voters should pick the president and the president should pick the justice for the Senate to consider," Biden said. "This was the position the Republican Senate took in 2016 when there were almost 10 months to go before the election. That's the position the United States Senate must take today, and the election's only 46 days off.

Trump, McConnell to move fast to replace Ginsburg

Photo: Alex Wong/Getty Images

President Trump will move within days to nominate his third Supreme Court justice in just three-plus short years — and shape the court for literally decades to come, top Republican sources tell Axios.

Driving the news: Senate Majority Leader Mitch McConnell and Senate Republicans are ready to move to confirm Trump's nominee before Election Day, just 46 days away, setting up one of the most consequential periods of our lifetimes, the sources say.

Updated 4 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 10 p.m. ET: 30,393,591 — Total deaths: 950,344— Total recoveries: 20,679,272Map.
  2. U.S.: Total confirmed cases as of 10 p.m. ET: 6,722,699 — Total deaths: 198,484 — Total recoveries: 2,556,465 — Total tests: 92,163,649Map.
  3. Politics: In reversal, CDC again recommends coronavirus testing for asymptomatic people.
  4. Health: Massive USPS face mask operation called off The risks of moving too fast on a vaccine.
  5. Business: Unemployment drop-off reverses course 1 million mortgage-holders fall through safety netHow the pandemic has deepened Boeing's 737 MAX crunch.
  6. Education: At least 42% of school employees are vulnerable.