Fitch Places Puerto Rico GO Bonds & Related Debt Ratings on Negative Watch

[Ad Orientem]

http://www.laht.com/article.asp?Article ... ryId=14092

And...

http://www.prnewswire.com/news-releases ... 04251.html

[Pointedstick]

Triple tax fee PR bond yields are back up to 11% on this news.

In performing this search, I found an Illinois bond financing some conference center somewhere that's currently yielding 14.5%. Crazy.

[Kshartle]

Triple tax fee PR bond yields are back up to 11% on this news.

In performing this search, I found an Illinois bond financing some conference center somewhere that's currently yielding 14.5%. Crazy.

Is it more likely that yields would go up or down after a downgrade? You would think they should go up since the rating agency should have a better idea of the risk than market. I don't think they do though. If the people in the rating agency could measure risk better than the market....they'd be in the bond-buying (and selling) business.

Is that 14.5% tax free? AHAHAHAH, good luck to anyone buying that bond. My God that sounds like a glorious waste of resources. What politician's cousin has the contract to build the conference center?

[Pointedstick]

Is that 14.5% tax free? AHAHAHAH, good luck to anyone buying that bond. My God that sounds like a glorious waste of resources. What politician's cousin has the contract to build the conference center?

It would be totally tax-free to residents of Illinois. And the damage has already been done; you'd be buying the bond on the secondary market so presumably the conference center to nowhere already exists.

[Kshartle]

Is that 14.5% tax free? AHAHAHAH, good luck to anyone buying that bond. My God that sounds like a glorious waste of resources. What politician's cousin has the contract to build the conference center?

It would be totally tax-free to residents of Illinois. And the damage has already been done; you'd be buying the bond on the secondary market so presumably the conference center to nowhere already exists.

They can discuss the state's bankruptcy in the conference center.

[goodasgold]

Puerto Rico and Greece, coming soon to a nation very near to you! Does Krugman care?

[Kshartle]

Puerto Rico and Greece, coming soon to a nation very near to you! Does Krugman care?

Sadly I think he does. The more poverty that is created by the policies he advocates the more clueless souls he can exploit with his columns by tickling their ears. He tickles them with the magical promise that if the goverment would just print trillions of slips of paper and force people to accept them in exchange for valuable stuff then their lives woudl be better.

[Pointedstick]

They can discuss the state's bankruptcy in the conference center.

Not while Illinois is the sitting president's home state. IL has at least another 3 years of favorable treatment from the federal government that it can use to kick the can down the road. If Hillary wins in 2016, I'd expect this to continue purely based on the fact that Chicago is an important political incubator for the next generation of corrupt scumbag machine politicians loyal Democratic elected officials.

All bets are off if the next prez is a Republican, of course. But that's seeming like a bit of a long shot.

[Ad Orientem]

Not everyone is panicking...
http://www.bloomberg.com/news/2013-11-1 ... -says.html

[Pointedstick]

Makes sense to me.

I'm trying really, really hard to resist buying some.

[Kshartle]

I went to PR back in May on a little vacation. I think we're going to head out there for another 4-day vacation for Thanksgiving. I lead a remote team of business and financial analysts (program accountants) out there so it's good to get face time once a year.

I'll check out the economy if we go, it looked awful in May. We did meet a lot of gringos moving there.