Posted on 08/03/2015 5:27:56 PM PDT by Enlightened1
Puerto Rico just went into default for the first time in its history.
The commonwealth paid a mere $628,000 toward a $58 million debt bill due Monday to creditors of its Public Finance Corporation. This will hurt the island's residents, not Wall Street. The debt is mostly owned by ordinary Puerto Ricans through credit unions.
"This was a decision that reflects the serious concerns about the Commonwealth's liquidity in combination with the balance of obligations to our creditors and the equally important obligations to the people of Puerto Rico," Puerto Rico's Government Development Bank president Melba Acosta Febo said in a statement.
The default is a historic moment in Puerto Rico's economic "death spiral," a term the island's governor, Alejandro Garcia Padilla, has used. The island is struggling with about $70 billion in total outstanding debt, and its economy is in recession.
Padilla has put together a team to come up with a plan to restructure Puerto Rico's debt crisis by the end of the summer.
(Excerpt) Read more at money.cnn.com ...
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A sovereign nation defaulting on a debt that is the equivalent of a Beverly Hills mansion. How pathetic of a government must PR have. And you wanted to be our 58th state? Sorry, Carlos.
No kidding!
PR is part of Region 3 of the US National Credit Union Association (Atlanta office) .. which usually insures deposits in CU’s.
Therefore, saying this will impact primarily depositors in PR credit unions... may not be the whole story...
There may be bondholders in 401k plans on the hook as well. They just don’t know it.
That’s helpful to American socialists. Even though it’s due to welfare and government debt, it will be blamed on capitalism.
Isn’t PR kind of a socialist state with big monetary help from the US?
How was PR permitted to run up such a deficit?
I agree.
How was PR permitted to run up such a deficit?
there have been some bond funds that are pretty heavy into PR issuances
once major brokerage firm had a bond fund (not advertised as a PR fund) that was half PR bonds (an extreme example, but there are others out there with PR bonds... this due to rules allowing state specific funds to also invest in territorial issuances as I recall)
we will see...the impact may spread further than just some ‘pr credit union savers’
Puerto Rico has been running a government Ponzi Scheme.
The only way to fix this is to find the politicians responsible for this and hang them and confiscate their wealth.
Exactly!
Give back our hubcaps and we will bail you out.
They didn’t have a governmental structure such as our wonderful establishment.
WE can run up 18 TRILLION dollaroes of debt because we have el presidente short pants negro
That is what happens when you give a perfectly good island to a bunch of mexicans (ducking and running)
oh wait, that's the responsible remark.
reality.........we'll just keep throwing good money after bad
PR had a good governor for a brief period, but he was defeated by the current demagogue who appealed to the ignorant and covetous, as demagogues always do. Most people still believe in the free lunch.
I always heard Puerto Rico never became a state because its people didn’t want to pay federal taxes. They just liked getting the goodies that came with being an American territory.
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