I’m surprised that so few of those commenting on Puerto Rico’s financial meltdown, like this article at CNBC:
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 payments due Jan. 4. He told reporters he plans to meet with bondholders in early January.
The down-to-the-wire negotiations over just which bondholders will get paid centered on a haphazard juggling act that saw the commonwealth shuffling funds from one account to another to pay its debts. That “clawback” process will likely be the subject of a series of lawsuits from investors who won’t get paid what they’re legally owed.
fail to mention something I would think is important. Puerto Rico just goosed its government employee compensation
Debt-ridden Puerto Rico started paying Christmas bonuses to public employees on Sunday and aims to complete the process within the next three days, the commonwealth government said.
It had been unable to confirm for weeks if it could meet the Dec. 20 deadline required under a 1969 law for the seasonal bonus. The payments total about $120 million, government officials said earlier this month.
Bonuses will be paid to government officials and regular employees of at least six months, and irregular employees who had worked at least 960 hours in a 12-month period.
presumably in expectation of a bail-out from the U. S. government which so far has not been forthcoming.
I included the graphic at the top of this post because of the guest appearance of the state of Illinois. There’s a bit of a gap between Illinois’s credit rating and Puerto Rico’s but that just means we have something to which we can aspire. Also, check out which state is just above us.
Since then, a long-running recession has sparked an exodus of companies and skilled workers.
Not just skilled workers, but anyone that can scrape up the money to move to Central Florida. The PRs from NYC are also moving here, as I guess they’ve decided they really don’t care for the cold weather, a sign of good sense on their part. The ones from the island don’t speak English as well, if at all, and when they do they don’t speak with a NYC accent.
Puerto Rico’s jobless rate is currently at 12.5 percent — more than double the national average of 5 percent.
This makes me wonder who’s doing their stats. Here on the mainland we’ve made an art of lowering the U-3 by dropping people out of the workforce. I’m wondering if there’s something with the welfare/UEC rules in PR that keeps people from being dropped off the U-# lists.