Comments on: Why Puerto Rico’s bonds are moving to New York http://blogs.reuters.com/felix-salmon/2014/03/03/why-puerto-ricos-bonds-are-moving-to-new-york/ A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: nixonfan http://blogs.reuters.com/felix-salmon/2014/03/03/why-puerto-ricos-bonds-are-moving-to-new-york/comment-page-1/#comment-49375 Tue, 04 Mar 2014 22:29:59 +0000 https://blogs.reuters.com/felix-salmon/?p=23204#comment-49375 It is in PR’s interest to not only default but also to repudiate. When it happens, all holders will be offered the same deal, such a bond worth ten or twenty cents on the dollar, a long maturity and a low interest rate. Puerto Rico is just another over-indebted Latin American country.

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By: y2kurtus http://blogs.reuters.com/felix-salmon/2014/03/03/why-puerto-ricos-bonds-are-moving-to-new-york/comment-page-1/#comment-49372 Tue, 04 Mar 2014 03:17:51 +0000 https://blogs.reuters.com/felix-salmon/?p=23204#comment-49372 I wish I could personally shake the hand of the dullard about to risk +50% of their principal for the 10% coupon payment. I mean my god look at how the Detroit creditors are about to be treated… Detroit looks pretty good next to PR.

I feel the idea of sovereignty is going to evolve somewhat in the decades to come. Before dismissing that idea consider how much sovereignty has changed in the last 25 years. (NAFTA, GATT, Carbon, ect.) Going forward I can see sovereign bonds backed by gold reserves held by a neutral 3rd party, or oil revs produced by offshore rigs, heck even wireless spectrum rights.

After enough creditors get screwed hard enough often enough Felix is going to get his wish and we’re going to see a lot more equity like investments in the world.

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By: drix http://blogs.reuters.com/felix-salmon/2014/03/03/why-puerto-ricos-bonds-are-moving-to-new-york/comment-page-1/#comment-49370 Tue, 04 Mar 2014 00:03:03 +0000 https://blogs.reuters.com/felix-salmon/?p=23204#comment-49370 NY v. PR venue is relatively meaningless, except that NY venue protects investors from the perception that the PR supreme court might feel political pressure to disregard the clear intent of the PR constitution. The issue is moot, however, since the constitution of PR and every single PR official has been clear in every word and action that they are NOT going to default on GO bonds and in a cash bind, would have no alternative but to pay GO bonds first. Prior to Detroit, the muni market would have believed them. After Detroit, the muni market, which was wholly unprepared for the ramifications of Chapter 9, panicked–and missed the fact that PR cannot file Chapter 9. BTW, investors salivating over 10% yields may well be disappointed. This deal is going to be heavily over-subscribed in the single digits because the panic is now abating. The peak of the opportunity has already come and gone, leaving pundits to drone on about it after the “turn around” has already taken place. This administration began the hard, painful work of cutting expenditures and raising revenues well over a year ago. Investors were extremely late recognizing the problem and even later recognizing that the remediation had already begun in earnest.

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