John Mousseau isexecutive vice president and director of fixed income of Cumberland Advisors.The views and opinions expressed in this piece represent only those of theauthors and are not necessarily those of S&P Global Market Intelligence.

On our commentary titled "Munis, Pensions, and a ClientEmail is Answered," David Kotok mentioned four states that CumberlandAdvisors is avoiding. Those states are Illinois, New Jersey, Connecticut andKentucky. It is important to recognize that we mean direct obligations of thosestates. That is because of concerns over pension funding, deficits, legislativeinertia and other issues.

We do own many credits WITHIN those states. Think of thedifference between Ocean County, N.J., and the state of New Jersey. OceanCounty is rated AAA by Moody's and Fitch with large debt service coverage.There are plenty of other very high-quality credits within the state of NewJersey. The same is true of the other states. The HEADLINE risk, in our view,is associated with these states' own credits.

So while we are avoiding the direct obligations of thementioned states, we continue to invest in and monitor, credits WITHIN thestates.