Puerto Rico Starts Missing Payments to Lenders

Our country’s Greece is still crashing and burning. From CNBC: “In default, Puerto Rico faces ongoing fiscal pain.” Like a homeowner with too big a mortgage, Puerto Rico has finally started falling behind on its payments. And it doesn’t look like there’s an easy way to refinance its huge pile of debt to make it more affordable. Gov. Alejandro Garcia Padilla announced Wednesday that the Caribbean island territory will be able to make most — but not all — of the nearly $1 billion in interest Read more […]

Just Print Some More Money!–US Is Urged to Bail Out Puerto Rico’s Bankrupt Economy

It seems the Obama Administration is in the business of printing money.  Today it was announced that the President is urging Congress to give the Island of Puerto Rico a handout to help them not go bust before the end of the year.  The bankruptcy protection offered to Puerto Rico is of some special type that is not available to the 50 states. Here’s the report from The Washington Post: With Puerto Rico buried in debt and on course to completely run out of money by the end of the year, the Read more […]

China Collapse Worse than Greece?

Australia media is reporting on a China collapse that might be “monstrous.” An Australian news outlet is reporting, “Chinese chaos worse than Greece.” WHILE the world worries about Greece, there’s an even bigger problem closer to home: China. A stock market crash there has seen $3.2 trillion wiped from the value of Chinese shares in just three weeks, triggering an emergency response from the government and warnings of “monstrous” public disorder. And the effects for Australia Read more […]

Greece: Being a “Developed Nation” Doesn’t Matter

I wouldn’t have noticed this story in USA Today about Greece, except that Drudge linked to it with the following headline: “First developed nation to default on international obligations…” I did not find that line in the story. But I did find the following paragraph: After the deadline passed (at 6 pm ET), Greece joined Zimbabwe, Sudan and Somalia in being in arrears to the IMF. Fitch Ratings has downgraded Greece’s government debt further into junk territory. There is no exceptionalism, Read more […]

Greek Debt Implosion Starting to Ripple Outward

The Greek debt crisis is affecting global markets; things are just getting started. It seems like the event that Bob Allen has often warned us about is finally beginning. The New York Times reported yesterday, “Greece’s Debt Crisis Sends Stocks Falling Around the Globe.” Global markets shuddered on Monday after Greece closed its banks amid fears that the country was headed toward default. Stocks slumped on Wall Street, after markets in Europe were buffeted by worries that the Greek debt Read more […]

Puerto Rico Is Our Greece and More Fallout Is Coming

Puerto Rico has AT LEAST $73 Billion in debt and they can’t pay it back. Puerto Rico has economic disadvantages. Energy prices are high and there are other challenges. So what did Congress do? Congress made Puerto Rican bonds available completely tax free. This should have caused an immediate alarm to investors. After all, if Congress is doing special favors to make bonds look attractive, then that must mean that Puerto Rican bonds are otherwise unattractive. In many cases reducing taxes Read more […]

Not Speaking English is a Social Security Disability?

Over two hundred Puerto Ricans were granted Social Security disability status because they claimed they could not speak English. I missed this story last week, but it deserves some outrage even at this late date. The Washington Post reports that the Social Security Administration has realized that it makes no sense to grant “disability” status to Puerto Ricans: “Puerto Ricans who can’t speak English qualify as disabled for Social Security.” Hundreds of Puerto Rico’s residents qualified Read more […]

Organized Crime as Police Department?

It is a really convenient situation for the United States to have Puerto Rico nearby. We can divert people from noticing our sins by pointing the finger at theirs. Don’t get me wrong. Their problems need to be fixed. But it is amazing to me how many people (I imagine) can read this story and not wonder about what is going on in their own municipality. From CNN Justice: “Puerto Rican police indicted for running ‘criminal organization’” Sixteen current and former police officers in Puerto Read more […]

Is Puerto Rico the Next Detroit?

I have been waiting for Illinois to be the first state to be forced into bankruptcy, and it may still win that race. But, while watching cities race toward bankruptcy, I had forgotten that there are other entities that are larger than counties but not the same as states—U.S. Territories. From the New York Times Dealbook blog: Puerto Rico’s fiscal agent has hired another well-known restructuring law firm, raising the specter that the financially troubled island is preparing to revamp its finances. The Read more […]