Posted on 05/01/2016 4:39:02 PM PDT by tcrlaf
Update: PR Governor Padilla has spoken...
-PUERTO RICO GOVERNOR SAYS WON'T PAY DEBT TOMORROW -PUERTO RICO GOVERNOR SAYS ISLAND WON'T PAY DEBT MONDAY -PUERTO RICO GOVERNOR: GOVERNMENT SIGNED MORATORIUM BILL YESTERDAY -PUERTO RICO NEEDS DEAL W/ CREDITORS AND/OR CONGRESS: GARCIA
And of course, demands a bailout... -PUERTO RICO GOVERNOR CALLS ON U.S. CONGRESS, PAUL RYAN FOR HELP
And then threatens...
-CRISIS WILL GET WORSE IF U.S. CONGRESS DOESN'T HELP: GARCIA -PUERTO RICO GOVERNOR CONCLUDES REMARKS TO COMMONWEALTH
A default on the $422 million due today is "virtually certain," S&P Global Ratings said April 11.
(Excerpt) Read more at zerohedge.com ...
BOHICA!
Yep. Those Mexicans literally breed their own problems. You can find grandmothers in their late 20's there and in Mexico without having to look too hard...
If the Island were ever to gain independence and thus folks there lose their US Citizen, there would be nobody left on the Island by the time it became Independent.
Maybe we should have just let them go, like we did that other territory we gained during the Spanish-American war, The Philippines.
Which is exactly why they will do it.
Like a bill passed by the PR government that all grade school students must read/write/speak English before graduating to middle school. And All middle school and above classes taught in English?
Obama letting the tension build.
Then he’ll say we could let PR suffer, but “that’s not who we are”.
When you hear that you know we are in trouble.
He never says who we are, by the way. Only who we are not, which would be anyone who disagrees with him.
Won’t MexiRico just get it over with and capsize or something?
There is no bailout.
No one is suggesting an infusion of cash.
Links or it didn’t happen.
States already have the right to orderly reorganization of their debts.
Puerto Rico wants the same rights.
I wonder what the western hemisphere would be like if it had been settled without Spain. We would probably have flying cars like the Jetson’s by now.
Grant them independence.
NO ! They have skimmed the cream for years, getting advantages without being a state. You are on your own, just another parasite.
They vote Democrat anyway. They’re mostly in Orlando.
What everybody seems to be missing is that this would not bail out Puerto Rico, but would instead be a bailout of the banks and other idiots who over-lent Puerto Rico money.
Let them default and let the bond holders take a major haircut in a restructuring, and let the derivative/bond insurer counter parties pay up.
This isn’t what WILL happen, however, but it is what SHOULD happen. It is what DID happen back in the day before central bankers/central planners ruled the world.
“In return for 20% of your now frozen bank accounts you will receive valuable Puerto Rican bonds”
Socialism is great until you run out of other people’s money.
There are a lot of retirement bond funds that have exposure, but you are correct that it’s the banksters that are the ones left holding the bag.
This is another Clinton orchestrated fiasco, the democrats didn’t like US corporations getting away with not paying taxes and repealed Section 936.
http://taxfoundation.org/blog/tax-policy-helped-create-puerto-rico-s-fiscal-crisis
I. Section 936 and Puerto Rico’s Nine-Year Recession
Throughout the modern economic history of Puerto Rico, one of the central drivers of its economic growth has been the United States tax code. For over eighty years, the federal government granted various tax incentives to U.S. corporations operating in Puerto Rico, in order to spur the industrialization of the island. Most recently, beginning in 1976, section 936 of the tax code granted U.S. corporations a tax exemption from income originating from U.S. territories.
In addition to section 936, the Puerto Rican corporate tax code gave significant incentives for U.S. corporations to locate subsidiaries on the island. Puerto Rican tax law allowed a subsidiary more the 80% owned by a foreign entity to deduct 100% of the dividends paid to its parent. As such, subsidiaries in Puerto Rico had no corporate income tax liability as long as their profits are distributed as dividends.
When section 936 was in effect, U.S. corporations benefited greatly from locating subsidiaries in Puerto Rico. Income generated by these subsidiaries could be paid to U.S. parents as dividends, which were not subject to U.S. corporate income tax under section 936, and were deductible from Puerto Rico’s corporate income tax.
Because of these generous tax incentives for business, Puerto Rico grew rapidly throughout the 20th century and developed a substantial manufacturing sector, though it remained relatively poor compared to the U.S. mainland. However, because section 936 made foreign investment in Puerto Rico artificially attractive – creating, in effect, an economic bubble – it left the island vulnerable to a crash if the tax provisions were ever to be repealed.
As it happened, section 936 became increasingly unpopular throughout the early 1990s, as many saw it as a way for large corporations to avoid taxes. Ultimately, in 1996, President Clinton signed legislation that phased out section 936 over a ten year period, leaving it to be fully repealed at the beginning of 2006. Without section 936, Puerto Rican subsidiaries of U.S. businesses were subject to the same worldwide corporate income tax as other foreign subsidiary.
This is an obvious ploy to deny Trump Puerto Rico delegates.
..:
Live by the debt, die by the debt...
Get bailed out,
OK, start paying Federal Income taxes.
Wait till California defaults. Or Illinois. Or ...
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