{"id":14801,"date":"2015-11-25T20:57:34","date_gmt":"2015-11-26T01:57:34","guid":{"rendered":"http:\/\/olduvai.ca\/?p=14801"},"modified":"2015-11-25T20:57:34","modified_gmt":"2015-11-26T01:57:34","slug":"puerto-rico-is-about-to-default-your-complete-guide-to-an-island-debt-debacle","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=14801","title":{"rendered":"Puerto Rico Is About To Default: Your Complete Guide To An Island Debt Debacle"},"content":{"rendered":"<h3 class=\"title\"><a href=\"http:\/\/www.zerohedge.com\/news\/2015-11-25\/puerto-rico-about-default-heres-your-complete-guide-island-debt-debacle\" target=\"_blank\">Puerto Rico Is About To Default: Your Complete Guide To An Island Debt Debacle<\/a><\/h3>\n<p>Last week, we\u00a0<a href=\"http:\/\/www.zerohedge.com\/news\/2015-11-20\/puerto-rico-faces-public-unrest-cash-crunch-may-leave-government-workers-unpaid\">brought you the latest<\/a>\u00a0from Puerto Rico\u2019s debt debacle. The commonwealth is desperately trying to restructure some $72 billion in debt while staring down a $354 million bond payment due on December 1.<\/p>\n<p><strong>As we discussed at length on Friday, some $270 million of what\u2019s due next week is GO debt\u00a0<\/strong>guaranteed by the National Public Finance Guarantee Corp. Defaulting on that is\u00a0<strong>bad news<\/strong>\u00a0and as Moody\u2019s warned earlier this month, a missed payment on the commonwealth\u2019s highest priority obligations \u201cwould likely trigger legal action from creditors, commencing a potentially drawn-out process\u00a0<strong>absent swift federal intervention.\u201d\u00a0<\/strong><\/p>\n<p>Make no mistake, federal intervention is likely to be anything but \u201cswift.\u201d<\/p>\n<p>A Senate judiciary committee headed by Iowa Republican Charles Grassley will meet on December 1 to discuss a legislative proposal to assist the Padilla government, but it\u2019s hard to imagine that a decision will be made in time to avert at least a partial default.<\/p>\n<p>Ultimately, the decision will be between paying bondholders and ensuring that the government can continue to provide public services, and just as Greece prioritized pensions over IMF payments last summer,\u00a0<strong>Padilla isn\u2019t likely to sacrifice the public interest at the altar of the island\u2019s debtors.\u00a0<\/strong><\/p>\n<p>So, as the clock ticks, we bring you the following helpful guide courtesy of Bloomberg who has made a \u201clist of the island\u2019s debt, how much is outstanding, when major monthly payments are due, and the source of funds that back the securities.\u201d<\/p>\n<p>* \u00a0* \u00a0*<\/p>\n<p><a href=\"http:\/\/www.bloomberg.com\/news\/articles\/2015-11-25\/puerto-rico-s-dec-1-deadline-a-guide-as-possible-defaults-loom\"><em>From Bloomberg<\/em><\/a><\/p>\n<ul>\n<li><strong>Puerto Rico Sales Tax Financing Corp.: $15.2 billion.\u00a0<\/strong>The bonds, known by the Spanish acronym Cofinas, are repaid from dedicated sales-tax revenue. A $6.2 billion portion of the debt, called senior-lien, is repaid first. The remaining $9 billion, called subordinate-lien, get second dibs. $1.2 million of interest is due in February and again in May. Senior Cofinas maturing in 2040 last traded for an average yield of 9.5 percent, while subordinate ones yielded 18 percent.<\/li>\n<\/ul>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Puerto Rico Is About To Default: Your Complete Guide To An Island Debt Debacle Last week, we\u00a0brought you the latest\u00a0from Puerto Rico\u2019s debt debacle. The commonwealth is desperately trying to restructure some $72 billion in debt while staring down a $354 million bond payment due on December 1. As we discussed at length on Friday, [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[83,195,200,1167,418,3824,4318],"class_list":["post-14801","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bloomberg","tag-debt","tag-default","tag-greece","tag-imf","tag-puerto-rico","tag-zerohedge"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14801","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=14801"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14801\/revisions"}],"predecessor-version":[{"id":14802,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14801\/revisions\/14802"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=14801"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=14801"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=14801"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}