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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsPuerto Ricans Are Broke and Feel Out of Luck
(Bloomberg) Opposite the headquarters of Puerto Ricos power company, Nelson Jimenez is selling lottery tickets. Hes not fooled by the shiny facade across the street, with its glass-and-metal curves.
The island is broke and business is bad, Jimenez says, gesturing at his thick wad of unsold tickets -- testimony to a public feeling down on its luck. Then he looks over to the utility building: They made a lot of money, and there were lots of bonds. But not anymore.
Of course, Puerto Rico still has bonds -- about $70 billion outstanding. What its short of is cash to repay them with. The indebted Caribbean island, home to 3.5 million U.S. citizens, has juggled dwindling resources from one hand to another for months now, to keep creditors at bay. The crisis is set to tip into a new phase this weekend when $422 million of payments are due and, as things stand, unlikely to be made in full -- threatening the biggest default yet.
Cue a flurry of activity in New York, where hedge funds are consulting their lawyers, and in Washington, where lawmakers are wrangling over a rescue package. Congress failed to come up with one by this weekends deadline, when the islands Government Development Bank, which lends money to the local authorities that run schools and other services, is the potential defaulter. Some of its bonds trade at just 20 cents on the dollar, amid last-ditch talks to defer payments.
Everyones Fault
The next key date is July 1 when $2 billion falls due, including so-called general obligation bonds that have the highest level of guarantees. Missing those payments would deepen the worst crisis to hit the $3.7 trillion U.S. municipal market. ............(more)
http://www.bloomberg.com/news/articles/2016-04-29/on-eve-of-default-puerto-ricans-are-broke-and-feel-out-of-luck
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Puerto Ricans Are Broke and Feel Out of Luck (Original Post)
marmar
Apr 2016
OP
I was thinking she'll enact a Greek Solution, a test run for the rest of the country.
Katashi_itto
Apr 2016
#3
Katashi_itto
(10,175 posts)1. Yes. Hillary will fix this.
Lol!
marmar
(77,081 posts)2. That would mean crossing her banker friends. I wouldn't hold my breath.
Katashi_itto
(10,175 posts)3. I was thinking she'll enact a Greek Solution, a test run for the rest of the country.
Sale off everything and leave them still in debt.
marmar
(77,081 posts)5. You're probably right.
bigwillq
(72,790 posts)4. So are a lot of folks in the USA
These are tough times