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Puerto Rico Announces Bond Payment "Moratorium"
Having concluded last night that Puerto Rico debt is "unpayable," and that his government could not continue to borrow money to address budget deficits while asking its residents, already struggling with high rates of poverty and crime, to shoulder most of the burden through tax increases and pension cuts, Padilla confirmed tonight that (from Bloomberg):
- *PUERTO RICO TO SEEK "NEGOTIATED MORATORIUM", 'YEARS' OF POSTPONEMENT IN DEBT PAYMENTS
Likening his state's situation to that of Detroit and New York City (though not Greece), Padilla concluded, the economic situation is "extremely difficult," which is odd because just a few years ago when they issued that bond - everything was awesome?
When will PR overtake Greece again?
Puerto Rico's Governor is speaking on national TV:
- *PUERTO RICO DEBT IS UNPAYABLE, GOVERNOR SAYS
- *PUERTO RICO DEBT LOAD WON'T LET ISLAND OVERCOME RECESSION: GOV.
- *PUERTO RICO GOV. SAYS HE DOESN'T AGREE W/ ALL OF KRUEGER REPORT
- *PUERTO RICO GOVERNOR SEEKS CREATION OF FISCAL BOARD
- *PUERTO RICO NEEDS COMPLETE RESTRUCTURING PLAN: GOVERNOR
- *PUERTO RICO TO SEEK `NEGOTIATED MORATORIUM' W/ BOND HOLDERS
- *PUERTO RICO MUST HAVE BETTER TERMS TO PAY DEBT: GOVERNOR
- *PUERTO RICO SEEKS ACCORD ON FISCAL REFORMS BY AUG. 30
And the punchline:
- *BONDHOLDERS SHARE RESPONSIBILITY FOR PUERTO RICO'S DEBT: GOV.
- *PUERTO RICO TO SEEK `NEGOTIATED MORATORIUM' W/ BOND HOLDERS
- *PUERTO RICO BONDHOLDERS MUST MAKE SACRIFICES TOO: GOVERNOR
- *PUERTO RICO TO SEEK `YEARS' OF POSTPONEMENT IN DEBT PAYMENTS
We suspect the 70 handle will quickly become a 50 handle or less...
As AP reports,
Puerto Rico's governor says he will create a financial team that will meet with bondholders and seek a moratorium on debt payments.
Gov. Alejandro Garcia Padilla made the announcement Monday night after saying that the U.S. territory's $72 billion public debt is unpayable. He said he would seek a moratorium of several years but did not provide specifics.
Garcia's comments come just hours after international economists released a gloomy report on Puerto Rico's economy.
Legislators are still debating a $9.8 billion budget that calls for $674 million in cuts and sets aside $1.5 billion to help pay off the debt. The budget has to be approved by Tuesday.
What happens next is unclear: "Puerto Rico, as a commonwealth, does not have the option of bankruptcy. A default on its debts would most likely leave the island, its creditors and its residents in a legal and financial limbo that, like the debt crisis in Greece, could take years to sort out."
So without the "luxury" of default, what is PR to do? Why petition to be allowed to file Chapter 9 naturally: after all everyone is doing it.
In Washington, the García Padilla administration has been pushing for a bill that would allow the island’s public corporations, like its electrical power authority and water agency, to declare bankruptcy. Of Puerto Rico’s $72 billion in bonds, roughly $25 billion were issued by the public corporations.
Some officials and advisers say Congress needs to go further and permit Puerto Rico’s central government to file for bankruptcy — or risk chaos.
“There are way too many creditors and way too many kinds of debt,” Mr. Rhodes said in an interview. “They need Chapter 9 for the whole commonwealth.”
García Padilla said that his government could not continue to borrow money to address budget deficits while asking its residents, already struggling with high rates of poverty and crime, to shoulder most of the burden through tax increases and pension cuts. Where have we heard that before...
He said creditors must now “share the sacrifices” that he has imposed on the island’s residents.
“If they don’t come to the table, it will be bad for them,” said Mr. García Padilla, who plans to speak about the fiscal crisis in a televised address to Puerto Rico residents on Monday evening. “What will happen is that our economy will get into a worse situation and we’ll have less money to pay them. They will be shooting themselves in the foot.”
And the punchline:
“My administration is doing everything not to default,” Mr. García Padilla said. “But we have to make the economy grow,” he added. “If not, we will be in a death spiral.”
And this one: any deal with hedge funds, who are desperate to inject more capital in PR so they can avoid writing down their bond exposure in case of a default, "would only postpone Puerto Rico’s inevitable reckoning. “It will kick the can,” Mr. García Padilla said. “I am not kicking the can.”
We wonder how long before Tsipras, who earlier was quoting FDR, steals this line too.
And speaking of Prexit, how long before Puerto Rico exits the Dollarzone... and will there be a Preferendum first or will the governor, in his can kick-less stampede, just make a unilateral decision to join Greece, Ukraine, Venezuela and countless other soon to be broke countries in the twilight zone of Keynesian sovereign failures?
* * *
But Puerto Rico is not Detroit... well actually it is... worse:
- *PUERTO RICO FACES SIMILIAR SITUATION AS DETROIT, NYC: GOVERNOR
Puerto Rico's debt is nearly half that of California for a population one-tenth the size... (via WSJ)
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whooooaaaa oh Domino"- Van Morrrison
Victoria Nuland should bring some of her cookies to PR’s Maidan ;-)
Speaking of the devil…
Stratfor has an interesting video about our misleading portrayal of Russia.
Usually, their analysis is very Nuland-esque, but this one is refreshingly different.
Looney
http://blip.tv/stratfor/conversation-the-u-s-media-s-misleading-portraya...
Is it really gonna hit the fan this time? I mean, I expected it for so many years I am kind of numb now ...
Regards,
Cooter
There ain’t no fan, CC. It’s a myth!
There’s a huge barrel of shit and a HUGE sledgehammer right above it ready to come down ;-)
Looney
PR to Putin Pivot. Iskanders in the Carib. Awesome.
That disturbance in the force you just felt,
was a few hundred bond funds, biting the dust.
Joor veemin, geev us joor veemin!...lol.
Shades of NYC in the 70's!
It's not a default, it's a moron-a-torium
Puerto Rich 2016 Presidential Campaign Pledge: " Will Vote for Debt Relief (and a little kickback)"
I did some biz in PR for one of the firms for which I worked and it was not too soon into the shimmy shimmy shake shake that it became clear as a bell in no uncertain terms that there was going to have to be some greasing of skids. We departed. Uh uh, no way "Jose"
BTW when you fly in or out and the plane is loaded with PRs, they do a cheer and trow their hands up in the air like a "wave" upon landings. A little strange.
… can’t they just get some
One of the local stock brokerages in San Juan that we drove past on it's sign said "Member SIPC".
I said to my business associate; "Look. They can't even spell Spic right"
Your Zen for the Day
Just call Gollum Sachs, they're the expert at lies and graft.
Cockroach Island.
They will reverse the direction of the fan blades. This will allow one to know where the shit will end up.
NY Federal Reserve:
At the Federal Reserve Bank of New York (popularly known as the New York Fed), we are proud that Puerto Rico is part of the Second District, which we represent in the Federal Reserve System. We are deeply committed to the people of the Island and to its growth and prosperity.
Good Job Mr Dudley of keeping us in the dark about this. Or did you not know? If not, why? Just what the fuck do you guys do up there, think of how you can strip the USA and it's common citizens of its wealth?
The Federal Reseve is either criminal or incompetent.
Why not both?
They absolutely knew. The situation in Puerto Rico has been circulating for a couple of years at least. The debt has been an issue in their local elections. Now it's hitting the fan is all. Apparently this is "no more kicking the can down the road" week. The Fed couldn't help but know.
It is either fully criminal or fully incompetent or it is partly criminal and partly incompetent.
The propaganda matrix, which they are a smut peddler subset of doesn't run on or so I'll take and for 5 cents.
It is so incompetent it tries to be fully criminal and fully incompetent at the same time. This is why the whole matrix collapses because the geniuses who set it up couldn't get their relationships right. A logical contradiction is a lie not truth so everything derives from a lie.
Lowering confederate flags (by a black which implies lack of color or signal etc) and raising rainbow flags (by a black/white which implies lack of color or signal and full color or signal) at the same time for an example.
Like I explained before the money for nothing mentality behind finance and central banks comes for the lie you are taught in school that 1 + 1 = 2.
It can't because the area of any shape can never be more than 1. So it really is 1 = 1/2 + 1/2 or 1 = 1/3 + 1/3 + 1/3 etc. The only way 1 + 1 can equal 2 is if we are talking about 2 equal shapes and sets like 2 squares with an area of 1.
See how the lie works yet. They muddy the deflation with inflation, i.e. infinite growth smaller within a set as infinite growth larger than 1 in the same set. {1 + 1 = 2} instead of 1*{1/2 + 1/2} 1*{1/2 + 1/2} = 2*{1/2 + 1/2}, money for nothing and your chicks for free. Then they wonder why they their models don't work.
The Hellenic Republic is the "shiny object." Is [Not so] Rich Port the "Black Swan?"
More of a "black albatros" at this point.
Never ever tell a Puerto Rican window washer that you want them spic and span
good news
coming to a Student Loan near you....in exchange for your continued votes, election after election, that is.....
best,
hillary
im sure this should send the phony paper prices of Gold and Silver soaring tomorrow just like Greece's new flow did today.....
Hot dogs for sale! Get 'Em while their hot!
Hot dogs for sale!
Why does the US hold on to this turd? It's a bottomless pit the govt throws money into, and what do they get in return?
Ricans with knives.
Hell, the Rican Separatists were trying to do us a favor in the 70's, ...until they started blowing shit up.
Way longer than that. They sprayed Congress with gunfire in 1954.
https://en.wikipedia.org/wiki/United_States_Capitol_shooting_incident_%2...
How about military bases?
http://militarybases.com/puerto-rico/
http://empire.is/
Wow! That's a lot of OPM.
Kyle Bass called this what, a year ago? Two years ago? PR is done. So is Greece, and Japan ain't looking too good.
Maybe this really is the start of the final act? We can only hope.
Nickel or tin...don't know which...got fucking clubbed today. I'll have to look it up...
Japan is in a whole other league I guess. Don 't forget Japan is still the third (!) national economy in the world.
Would you really like to wager on a radioactive Wantanabe?
Apparently there are some real tax advantages to living in Puerto Rico.
http://www.forbes.com/sites/robertwood/2014/07/04/hate-taxes-move-to-tax...
No fucking thanks.
Gee I wonder where all that proud puerto rican population went?
New York.
Orlando.
Cuba Libre.
Is Jade Helm be re-routed south now?
ISIS more likely.
The biggest difference between PR and Haiti maaan, is the white Federal TaxPayer, maaan. Colonial shame that we will pay for again and again. FU PR
Just tell me when I can stop paying my bills for an indeterminate amount of time.
Any time you like, and you'll get to meet all sorts of
interesting people,lawyers, bailiffs and the like.
And then you'll get to meet Big Bubba...
Your cell-mate. (Don't drop the soap!)
Bullish !
Puerto Rico just set the template that each country will do as they all fall into the same situation over the next few years.
The debt of nations is not entirely lawful for it was created via deception by the powers that be in those nations and so the people are only partially liable for sending their energy to those elites. The partial liability itself only exits because of the peoples ignorance inertia and unwillingness to learn, if they had done this much they would have zero liability, but of course the debt would not be here if they had done this.
We need to understand that you do not need a debt based economy at all. Its really just the offsrping of a war based economy. Borrowing as part of a normal running of a business or in private life to get by is not normal neither is it required in a sustainable economy.
Paging Dr Varoufakis, you're needed for the negotiating team...
Puerto Rico
~ The dark horse on the outside going into the third turn ~
BURN THIS BITCH DOWN!!!!
As long as you call it something other than a default everything is ok in the matrix.
Call it a default and there's gonna be a glitch.
Caveat creditor.
I wonder whether Putin would be interested in a new Caribbean base? Or maybe China?
“There are way too many creditors and way too many kinds of debt,” Mr. Rhodes said in an interview. “They need Chapter 9 for the whole commonwealth.”
Oh, come on, you can think bigger than that.
Who is Mr. Rhodes? They never say who he is. Is he like Mr. Wolf?
If you think about it, given it's size, PR has got one hell of a debt on it's hands. "Unpayable?" Damn Straight, that money will never be payed back. Creditors will seek to extend and extend, anything to prevent booking the losses until current managers retire. Hedge Funds might have taken advantage of the higher yields. If so, they got a risk premium paid to them, so now, the risk has emerged, they have no bitch here. They took the premium and the risk, let the whole fucking thing default. That is capitalism, you fucks should not have bought PR bonds. I didn't because I am too smart, so who the fuck made these Hedge Fundes Billionaires? Feeble Cunts!
Sing it, Jack, sing it.
Transitory.
Can I skip my debt payments too?
CA Gov Jerry Brown is praying that he leaves office before the stock market crashes.
Do you really think he knows the difference?
So who holds the counter party risks on the credit default swaps? I would think those folks would be well advised to stay away from nail guns.
Default is such an icky, CDS-laden word.
WHEN THE GOING GETS TOUGH, THE TOUGH CHANGE THE ACCOUNTING RULES.
What does puerto rico make besides young broads for porn, and military bases?
https://www.youtube.com/watch?v=DDIQNO8PS8M
I think this guy was the guy who was running the Greek Finance Ministry too.
Puerto Rico is one of the most liberal, pandered, privleged, enabled mutts around. I have known several Puerto Rican professionals in the US who were among the most arrogant promoters of Puerto Ricos liberal tax and spend status - and especially bragging about the extent to which the US pours tax exemptions and largess into that rat hole. That place makes Greece look frugal and underprivleged.
I heard they had one liberal judge down there that approved virturally every single case for aid or disability that came into his court. No proof, just say your back hurts too much to work, and you went right on the dole. That kind of thing is what makes a country fail. What if a wolf pack with ten wolves pulled that crap? Nine all sat around and only one was left to hunt. Think that would work? My opinion is strong here: if it won't work in nature, it won't work for humans. True capitalism (not crony facism) mimics nature best. It's the liberals that bend it too much that it stops working. There's a little bending room, but those progressive elitists turn it into a spiral on steroids.
Something else that doesn't work in the real world of natural law. Homos, and abortion. Liberals & progressives are a self fullfilling dying freak of nature.
Barry Soetoro will make them all legal Americans as long as they don't work, become 100% dependent on the U.S. Gov, & vote democrat.
Americans could go on an income tax "moratorium."
Or call it a "holiday."
WTF.....NO CHICKS!
Puerto gRico,
next.
we are all screwed. It is just a matter of time.
WWW.USDEBTCLOCK.ORG
Peter Schiff was moving operations there because of low taxes. I am a fan of Schiff's so I hope he doesnt get bitten in the end.
Whenever some people can borrow money that other people must repay, massive injustice and disaster are certain to occur.
Is this surprising to anyone?
All predators-DBA-government operate this way.
Is this surprising to anyone?
Port Uh Rico. Isn't that a city in Haiti?