Muni bonds ought to have had a rough week, with outflows more than doubling from $875 million to $1.9 billion and more than $11 billion in new issuing, but a Volcker Rule exception and a few other positive trends actually caused them to recover. Doubling of Muni bonds fund outflows “Despite a combination of factors that might have been expected to generate significant distress, which include the heaviest new issue supply of the year, a week-over-week doubling of bond fund outflows, and some signs of tax loss selling, the market ended the week with slightly lower yields than it began,” write…