Seeking Alpha

Puerto Rico debt cut to junk by S&P

Comments (11)
  • Bullish, the Fed's gonna buy Puerto Rico bonds soon.
    4 Feb, 05:33 PM Reply Like
  • The bonds are getting down to a level at which they are beginning to attract my attention - I am waiting for 20%+ yields soon.
    4 Feb, 06:17 PM Reply Like
  • 20% may be too ambitious.
    These bonds were already trading at rates reflecting much more than a one notch downgrade (probably 4-5 notches actually).
    GDB of PR bonds could have been bought earlier this week for 16% ytm for 2017.
    I won't be surprised to see a rally over the next few days and if PR manages to raise 1-2Billion in the coming month we could probably see a 5%-10% rally in its bonds quite quickly
    4 Feb, 08:46 PM Reply Like
  • be interesting to see what/if they used those bonds for as collateral
    4 Feb, 06:29 PM Reply Like
  • I was only reading about the history of Puerto Rico this week, about how the US invaded in the late 1890s as part of its empire building, how their leaders were arrested and given long jail sentences and how Puerto Rico ever since has been used as a cheap source of labour for US businesses. The Puerto Ricans stuck in limbo between not being independent but not having full US rights unless they move to the mainland.


    Amazing what you can learn from wikipedia.
    4 Feb, 07:22 PM Reply Like
  • Yet they just don't hate 'us' enough to move to full independence... Wonder why that is...
    4 Feb, 11:13 PM Reply Like
  • Debt can be just a powerful an occupier as any army.
    5 Feb, 07:22 AM Reply Like
  • I don't see how the monolines can get hurt here.
    4 Feb, 08:29 PM Reply Like
  • No big deal. The average American company is junk rated as managements realized that leveraged balance sheets to fund acquisitions and buybacks helped shareholders. Government shareholders are the voters and now government, including the federal government, realizes that high debt levels to fund voter friendly projects is a winning formula for politicians.
    Be it a company or a government It is simply too expensive to maintain a high grade rating.
    4 Feb, 10:15 PM Reply Like
  • How is +0.3% "taking a hit"?
    4 Feb, 11:31 PM Reply Like
  • Guilt by association.
    5 Feb, 01:28 AM Reply Like
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