Guest Post: Puerto Rico’s Debt Crisis – Another Domino Keels Over | Zero Hedge. (FULL ARTICLE)
If one looks at various sovereign states, it seemingly doesn’t matter that their public debts continue to rise at a hefty clip. The largest ones are considered to have economies that are big and resilient enough to be able to support the growing debt load. Part of the calculus is no doubt the notion that they contain enough accumulated wealth to allow their governments to confiscate even more of their citizens property and income in order to make good on their debts.
Then there are the small and mid-sized states in the EU that are getting bailed out by their larger brethren, or rather, the tax payers of their larger brethren. However, things are different when the territories or municipalities concerned are considered too small and have no such back-up. Detroit was a recent case in point, and it seems that the US territory of Puerto Rico is the next domino to fall. Here is a recent price chart of the Puerto Rico 20 year bond maturing in 2033, which currently yields 10.6% and trades at 46 cents below par:…
Related articles
- U.S. Treasury Not Planning Puerto Rico Aid, Spokeswoman Says (bloomberg.com)
- Puerto Rico Follows Detroit Into Fiscal Abyss (confoundedinterest.wordpress.com)
- Should Puerto Rico default on its sovereign debts? (priorprobability.com)
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