Salient to Investors:

Texas bonds this year have outperformed other top-rated states.

John Bonnell at USAA Investments said the nation’s second-biggest economy shields Texas from cutbacks and lures bond investors, with demand for almost everything in Texas.

Robert Dye at Comerica said:

  • The population of Texas, the second-most-populous state, is younger than the U.S. average
  • As the biggest U.S. oil producer, benefits from crude that is up 18 percent from June low
  • State policies limit state spending
  • Job growth in Houston and Austin is expected to be double the national average in 2012 and 2103, with Dallas and San Antonio above U.S. average.
  • Even if the economy weakens more than expected, Texas will repeat 2008 and 2009 when it was last in recession and first out.

Michael Zezas at Morgan Stanley said Texas, ranked 23rd in state military employment as a percentage of total jobs, is less vulnerable than other top-rated states to defense-industry cuts.

Economist Ray Perryman said  the impact of government cuts would not be big enough to take down Texas.

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