PUERTO RICO’S creditors have plenty to complain about, but they can’t claim they weren’t warned. Last June Alejandro GarcÃa Padilla, the governor of America’s Caribbean outpost, announced that its $72 billion public debt was “unpayable”, and that a “unilateral and unplanned non-payment of obligations” loomed. Half a year later, he has fulfilled that threat: on January 4th the government missed a $36m coupon on paper issued by its Infrastructure Financing Authority. “There were those who said I was bluffing,” he says. “I told the truth. To avoid a new default, [bondholders] have to sit down and negotiate.”
Unlike fiscal crises elsewhere, the decision did not set off pot-banging protests or queues at cashpoints. On the contrary, the governor was all smiles the next day as he welcomed children into La Fortaleza, his colonial-era palace in the capital of San Juan, for the eve of Three Kings’ Day, which Puerto Ricans (boricuas, as they call themselves) celebrate as much as Christmas. Plaza las Américas, the city’s mega-shopping mall, was packed as parents finished shopping for gifts to put under their...Continue reading
Source: United States http://ift.tt/1RcanNz
EmoticonEmoticon