Blue Island on the Brink
Puerto Rico Nears Default
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  • free_agent

    You write, “Puerto Rico’s status as a territory will make it legally impossible for the island to enter bankruptcy.”

    What are the odds that Congress amends Chapter 9 of the bankruptcy code to permit territories to declare bankruptcy? That seems like the only solution other than the territory unilaterally declaring that it won’t pay a fraction of its debts.

  • William Ockham

    Where were the bond rating agencies, Moody’s, Fitch and Standard and Poor’s, when all this happened? A situation like Puerto Rico’s where It’s debt is 83% of per capita personal income (while California, Illinois and New York are at 6%,) must have developed over decades. Why weren’t Puerto Rico’s bonds rate at junk grade ten or twenty years ago? This would have prevented their receiving credit and getting in this crisis? Or is just like the AAA ratings on the subprime mortgage CDO’s?

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