Moody's takes chainsaw to Puerto Rico credit rating

Moody's downgrades Puerto Rico's GO bond rating by a big three notches to B2 from Ba2, and cut ratings on the commonwealth's other debt as well in wake of last week's passage of a law allowing public corporations to defer or reduce debt payments.

"Puerto Rico’s new law marks the end of the commonwealth’s long history of taking actions needed to support its debt. It signals a depleted capacity for revenue increases and austerity measures, and a new preference for shifting fiscal pressures to creditors."

MBIA (MBI -0.6%), Assured Guaranty (AGO -3.1%)

Previously: U.S. firms take new Puerto Rico law to court

Comments (4)
  • minecanary
    , contributor
    Comments (1413) | Send Message
    Sounds like the U.S. gov't will be suing them extra soon
    1 Jul 2014, 08:14 PM Reply Like
  • omarbradley
    , contributor
    Comments (966) | Send Message
    meh. what good does that do? the whole purpose is to keep these matters from having to go to Court in the first place.
    1 Jul 2014, 10:10 PM Reply Like
  • minecanary
    , contributor
    Comments (1413) | Send Message
    It doesn't do any good. The point is the gov't doesn't want any scofflaws debt ratings diminished (especially their own) so everyone can go on spending
    wildly beyond their means w/no repercussions.
    2 Jul 2014, 10:07 AM Reply Like
  • june1234
    , contributor
    Comments (4504) | Send Message
    I see a racial discrimination angle for an enterprising lawyer. Obviously the Ricans don't have Janets tel# on speed dial. If Im them Im suing, everybody else has access to her closet.
    2 Jul 2014, 06:17 AM Reply Like
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