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posted by n1 on Sunday May 07 2017, @04:45AM   Printer-friendly
from the my-2c dept.

Puerto Rico announced a historic restructuring of its public debt on Wednesday, touching off what may be the biggest bankruptcy ever in the $3.8 trillion U.S. municipal bond market.

While it was not immediately clear just how much of Puerto Rico's $70 billion of debt would be included in the bankruptcy filing, the case is sure to dwarf Detroit's insolvency in 2013. The move comes a day after several major creditors sued Puerto Rico over defaults its bonds.

Bankruptcy may not immediately change the day-to-day lives of Puerto Rico's people, 45 percent of whom live in poverty, but it may lead to future cuts in pensions and worker benefits, and possibly a reduction in health and education services. The island's economy has been in recession for nearly 10 years, with an unemployment rate of about 11.0 percent, and the population has fallen by about 10 percent in the past decade.

The bankruptcy process will also give Puerto Rico the legal ability to impose drastic discounts on creditor recoveries, but could also spook investors and prolong the island's lack of access to debt markets.

The debt restructuring petition was filed by Puerto Rico's financial oversight board in the U.S. District Court in Puerto Rico on Wednesday, and was made under Title III of last year's U.S. Congressional rescue law known as PROMESA.

The Title III provision allows for a court debt restructuring process akin to U.S. bankruptcy protection. Puerto Rico is barred from a traditional municipal bankruptcy protection under Chapter 9 of the U.S. code.

The filing includes only Puerto Rico's central government, which owes some $18 billion in debt backed by the island's constitution. On paper, it does not include $17 billion of sales tax-backed debt, known as COFINA debt, or debt from other agencies.

But those debts are likely to be pulled into the bankruptcy, or included in separate bankruptcy proceedings in coming days, Elias Sanchez, an adviser to Governor Ricardo Rossello, told Reuters on Wednesday. Puerto Rico's massive pension debts will also likely get restructured in the bankruptcy. "Title III was especially compelled by the commonwealth's need to restructure $49 billion of pension liabilities," the oversight board said in Wednesday's filing.

-- submitted from IRC


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  • (Score: 2) by drussell on Sunday May 07 2017, @09:21AM (6 children)

    by drussell (2678) on Sunday May 07 2017, @09:21AM (#505773) Journal

    You really don't have to be jobless to understand that the economists are blowing smoke up our asses.

    Dude, You're confused... It's not the economists that are screwing things up!

    :facepalm:

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  • (Score: 5, Insightful) by Runaway1956 on Sunday May 07 2017, @09:52AM (5 children)

    by Runaway1956 (2926) Subscriber Badge on Sunday May 07 2017, @09:52AM (#505784) Journal

    Yes, and no. Few if any economists actually have the means to screw up the economy. But, they do come up with some crazy ideas about what a "healthy" economy is. They also lend credibility to the various politicos and/or rich bastards who do have the means to screw with the economy. And, then, they make excuses, when they aren't outright lying to you about the state of the economy. So, yeah, they are blowing smoke up our asses. If the economists were honest with us, we would probably have revolted long ago. Maybe late in the '50's, or early in the '60's? "The economy is screwed up, people, but government is relying on the Military Industrial Complex to keep that economy afloat. Currently, the US makes more money from killing people, than from personal income taxes, or from corporate income taxes."

    • (Score: 0) by Anonymous Coward on Sunday May 07 2017, @10:28AM (4 children)

      by Anonymous Coward on Sunday May 07 2017, @10:28AM (#505794)

      We must be patient with Runaway. He still thinks that Republicans support his interests. So not unusual that he blame economists, proctologists, SJWs and Hillary for his own economic, um, shortcomings. But he will start to understand, once Trump really gets going. But then it will be much too late. Poor Runaway! Poor, poor, poor Runaway!

      • (Score: 2, Interesting) by Runaway1956 on Sunday May 07 2017, @11:34AM (3 children)

        by Runaway1956 (2926) Subscriber Badge on Sunday May 07 2017, @11:34AM (#505802) Journal

        No, it's you who people have to be patient with. Runaway is no Republican, he doesn't trust Republicans, he doesn't vote Republican by choice. In your own tiny little mind, there is only room for "us and them", "Democrat or Republican". I hate to be the one to disillusion you, but there is a vast spectrum of political positions. It isn't all "left or right". If you dare to explore, you might check out some of these pages:

        http://www.gotoquiz.com/politics/political-spectrum-quiz.html [gotoquiz.com] Appears to be pretty damned simplistic - the choices on the front page refer to left, neocon, and moderate. Typical American type of quiz.

        https://www.politicalcompass.org/test [politicalcompass.org] That is a much more meaningful test, with far more meaningful results, and some definition given to the spectrum. Take the test, you may be surprised at yourself.

        https://buildquorum.com/political_spectrum [buildquorum.com] Looks American-centric, but somewhat better than that first over simplistic pile of shit. That one tells me that I'm a "populist leaning liberal". Doesn't THAT blow your mind? I didn't promise that it would be good, or that it would be accurate, I only promised that it's better than the first pile of shit.

        Feel invited: LEARN ABOUT THE POLITICAL SPECTRUM BEFORE RUNNING YOUR MOUTH ABOUT WHAT YOU THINK I MIGHT BE!!

        For 43 years now, I've possessed a card that proclaims me to be "Independent". Never once have I possessed a similar card with either "Republican" or "Democrat" on it. Never once. Please stop referring to be as a Republican.

        • (Score: 0) by Anonymous Coward on Sunday May 07 2017, @03:42PM (2 children)

          by Anonymous Coward on Sunday May 07 2017, @03:42PM (#505864)

          he doesn't vote Republican by choice

          But if they still get your vote, then what does it matter if you say you're not a republican?

          • (Score: 3, Informative) by Runaway1956 on Sunday May 07 2017, @03:53PM (1 child)

            by Runaway1956 (2926) Subscriber Badge on Sunday May 07 2017, @03:53PM (#505872) Journal

            *SOMETIMES* the best choice for an office is a Democrat - so I have voted for democrats sometimes. *SOMETIMES* the best choice is a Republican - so I have voted for some Republicans. *SOMETIMES* the best choice is third party - so I have often voted third party. And, *SOMETIMES* the best choice for an office is *NOFUCKINGBODY* and/or a writein - so I have left boxes on the ballot blank, or I have filled them in with an underdog's name, and I have even written in cartoon characters to show my contempt for the choices available.

            I don't vote party line. This last election is as near as I have ever voted a party line. There was a runner for president from the Libertarian party, I had a Libertarian choice for the Senate, and there were a couple Libertarians running in state and local offices. I voted ONE candidate in a minor office from the two major parties, and it doesn't even matter which party that was. I voted AGAINST every single incumbent who was uncontested.

            Now, do you get the idea? I'm not a Republican. If you care to accuse me of being conservative, I'll accept that accusation graciously. You may accuse me of being somewhat authoritarian - that would be accurate. You MAY NOT affiliate me with either of the shit parties that play musical chairs in our capitals every couple of years. I detest them both, but I detest the "progressive" party more. The R's are only slightly the lesser evil, in comparison to the D's.

            • (Score: 0) by Anonymous Coward on Sunday May 07 2017, @09:23PM

              by Anonymous Coward on Sunday May 07 2017, @09:23PM (#505991)

              Poor, poor, poor, even more poor Runaway. He thinks he's an independent, but just look as his usual sources for news. Brietbarf? Washing the Bacon? Yep, Republican. The first step, Runaway, is admitting you are the problem.