Comments on: Puerto Rico’s black swans http://blogs.reuters.com/muniland/2012/05/16/puerto-ricos-black-swans/ Bridges, budgets, bonds Mon, 24 Nov 2014 00:29:08 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: BoricuaActivao http://blogs.reuters.com/muniland/2012/05/16/puerto-ricos-black-swans/comment-page-1/#comment-983 Tue, 22 May 2012 16:42:18 +0000 http://blogs.reuters.com/muniland/?p=9721#comment-983 I want to correct a few misconception by some of the “experts” quoted in this article.

First, when Mr. Peter Hayes says that the Puerto Rican economy relies heavily on tourism, he neglected to mention that tourism barely represents 6% of the Commonwealth’s GDP. The largest sector of the Island’s economy by far is manufacturing.

Regarding Mr. Cottier’s assertion that the U.S. federal government would bail out Puerto Rico, I highly doubt that it would, since it refused to bail out California, which is the 8th or 9th largest economy in the world.

In terms of the possibility of tax exemption being taken away, that is highly unlikely since this would require either a change in the country’s political status as a Commonwealth, or an explicit act of the U.S. Congress that would have far reaching economic implications in the U.S. as well as in Puerto Rico. Very slim possibilities that U.S. pharmaceuticals, the 4 million Puerto Ricans in the U.S., as well as other influential investors, and politicians would let that happen. Puerto Rico would also not likely want to shoot itself in the foot and eliminate its local tax exemptions.

What Puerto Rico needs is to stop financing its debt with more bond issuance and increase labor force participation through a restructuring of U.S. welfare transfers. In the short run, an additional U.S. tax incentive would produce needed growth. More economic autonomy provided by enhancing Commonwealth status or eventual independence would unleash Puerto Rico’s economic potential in the long run.

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By: johnhhaskell http://blogs.reuters.com/muniland/2012/05/16/puerto-ricos-black-swans/comment-page-1/#comment-970 Thu, 17 May 2012 09:01:10 +0000 http://blogs.reuters.com/muniland/?p=9721#comment-970 Yes, something totally foreseeable like an economic slowdown should be considered a “black swan.” Also, my plane leaving LaGuardia an hour late is a “black swan.” As is traffic on the BQE.

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By: Capt.America http://blogs.reuters.com/muniland/2012/05/16/puerto-ricos-black-swans/comment-page-1/#comment-969 Thu, 17 May 2012 05:22:59 +0000 http://blogs.reuters.com/muniland/?p=9721#comment-969 Well, if you take into account 9 million Americans have are no longer being counted since 2008 in the employment report- that’s over 11% of the entire work force which simply vanished into thin air in aprox. 4 years.

There is no way they can double that more accurate (by the real definition of unemployment) with the 8.1 that is actually in the island. -I mean can this ‘indolent’ people get to a 22%?

I think this will best describe what is really going on…

Excerpt from book: “_*The History of Puerto Rico* From The Spanish Discovery To The American Occupation_” by R.A. Van Middeldyk (1915)

“[Nothing]…have been sufficient to _make these islanders abandon the indolence_ with which they regard the most important of all arts, and the first obligation imposed by God on man-namely, the cultivation of the soil.”

I believe this picture will clearly describe or better yet should be the illustration of that parragraph.

http://www.flickr.com/photos/tlehman/155 5720379/in/set-72157602389493576

This reminds me of how some people argue the color teal is more green than blue. -This is just so funny!

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