Judge it!
HELP!!! Will someone please explain in easy-to-understand language this financial report on investing in Puerto Rico. Does this report indicate that Puerto Rico is taking the right actions and will eventually be economically okay?
I note that this Bloomberg report covers in great detail the reduction of the workforce, but says nothing about Fortuño's privatization plan based on PPPs - Public Private Partners.
Nov 13, 2009 | Posted by: Upfront Yankee
‘Dicey’ Puerto Rico Bonds Beat U.S. States as Fortuno Cuts Jobs - Bloomberg - 13/11/09
By Jerry Hart - Nov. 13 (Bloomberg) -- Governor Luis Fortuno’s declaration of a fiscal emergency hasn’t deterred investors from buying Puerto Rico’s bonds, which have returned 20 percent this year, more than any U.S. state.
Keeping investors interested in the Commonwealth’s $47 billion of debt may depend on the Republican governor’s plan to cut a $3.2 billion budget deficit, revive an economy that shrank 5.5 percent in the last fiscal year and rescue a credit rating one level from high-risk, high-yield junk. Since taking office in January, Fortuno eliminated 22,500 government jobs, riling a constituency that makes up 30 percent of the labor force.
“I’m not here to win a popularity contest,” Fortuno, 49, said by telephone from San Juan during a national strike on Oct. 15, when protesters and police clashed outside the Fortress, his home in the old section of the walled capital founded by Spain in 1521. “I’m here to deliver results.”
Bonds of Puerto Rico, which was ceded to the U.S. in 1898 after the Spanish-American War, are exempt from taxes in any state, unlike most municipal debt. The securities have benefited from record cash flows into municipal-bond funds, masking an economy that contracted in the 12 months ended June 30 at twice the 2.4 percent forecast for the country as a whole in 2009, the median estimate of analysts in a Bloomberg survey.
**************
To support fired workers’ transition into private employment, Fortuno’s plan includes a $2.5 billion stabilization fund financed by sales-tax-backed bonds sold by the development bank. Carlos Garcia, president of the San Juan-based institution, said $1.5 billion for the fund was raised from a $5.3 billion series of bonds announced in June.
In the interview last month, Fortuno invoked memories of 2006, when government offices shut for more than two weeks until lawmakers negotiated a bailout from the development bank to plug a revenue shortfall.
“We don’t have a choice,” Fortuno said. “I’m not going to allow this place to close down like it did once.”
[Open link for original source and full report.]
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UPFRONT Y.
Another thing if you like to do some investigation is check out the stock prices of PR banks since the high of January of 2005,,,3 years before the ''Great Recession'' of 2008. And no one in the P Rico media was telling the people in PR that the bank stocks such as R&G Bank hit a high of $40 in January 2005,,,and is now selling for .25 cents! Banco Popular hit a high of $28 in January 2005, and now is $2.30 a share! and still losing money! The media in PR hides the truth alot...there is alot of funny businesss between Fortuno and Richard Carrion the CEO of Banco Popular. So much so, you would almost have to write a small book. Do you own due dilegence, on PR banks. Go to Yahoo Finance for charts and news,,, debate with you another day...tjm |
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Puerto Rican bonds seem to be hot lately. Investors see current fiscal policy as a sign of solid reform. Investors believe the higher yielding bonds are far from defaulting or getting worse. Unfortunately this could translate into higher Puerto Rico debt backed by higher local taxes. Puede ser comparado a una tarjeta de crédito pre aprobada en el correo.
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A lot of conjecture on your part about Banco Popular. The bank is merely reflecting the poor state of the island economy: massive unemployment, budget deficits, economic deflation (5.5% in the last year) and a mortgage crisis (tens of thousands of foreclosres). |
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Aside from that it sold its U.S. mainland subsidiary which was losing a lot of money (for 1.48 billion dollars).
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This is basically the same info but clarifies a couple of points. read here---->>>http://www.caribbeanbusinesspr.com/news03.php...
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Not just Banco Pop.,,,R/G Bank had an all time high of $40 and now trades on the ''pink'' sheets, at .25 cents PR was falling apart since 2004, just that the P Ricans didnt see this,,,I did! |
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"Lucky guess" as they say and now you are gloating. |
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Perhaps you should look again at Banco Popular's stock. Hate to "bust" your bubble. By the way, many U.S. stocks hit rock bottom like Ford stock. It hit a low of about $1.53 per share about a year ago. It is slowly rising and is trading at over $8.00 per share today. I had bought a lot of stock there before it took a dive. |
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Ill bust your bubble,,,see you at Dow 6000 again by October 2010!! laugh will be on you! keep buying,,,u will go broke! just read my book when it comes out! |
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and I will say this,,,Dow 6000 by October 2010! bye!! |
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To answer some of these questions one must ascertain WHO is buying these bonds. The same banks in Puerto Rico that have taken such a hit on their stock prices are the buyers of most of these bonds. AND, like Banco Popular, they are using TARP money from the US government to buy them. Banks take the deposits of customers and invest it. Some of it they lend to other customers and companies, but not all of it. They were investing in mortgage backed bonds. But those bonds went belly up, making the banks troubled. The troubled banks borrow the TARP money at a low rate of interest but must invest it in 'something.' Puerto Rican banks support their government by purchasing Puerto Rico bonds. Because these bonds are still rated as 'investment quality' banks supervised by the Federal Reserve Bank and the FDIC are allowed to buy them for their portfolio of investments. But Puerto Rico bonds pay the highest rate of interest of any investment grade municipal bonds sold on the US market. AND the interest on these bonds is tax exempt so they NEVER have to pay taxes on the interest from these bonds, even when the banks are profitable. So, Puerto Rican banks get to buy Puerto Rican bonds with TARP money and make a profit from the interest, support the current government and avoid paying any taxes on the interest. They don't worry about losing money on the bonds because Puerto Rico can't 'bankrupt' itself. Puerto Rico will merely fire more government employees, raise taxes, sell new bonds, or, most likely, a combination of all three to pay the bonds when they become due. |
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Once again,,,,someone on this message board with some intelligence! Because the editor ''Upfront Yankee'' has none,,,,,,is time we all face the facts to save this island! |
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Judged: 
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1 TRULY YOU ARE BEYOND HELP AS AN EDITOR,,,,JUST LEAVE! |
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Since: Dec 08
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I expect a hateful, poorly informed comment from a loser like you. What can someone expect from a closed minded, nasty, right-wing Republican. The good news is that your kind is getting smaller and smaller. The party in power are open-minded, well informed, loving Americans who believe in social democracy and honor Franklin D. Roosevelt, John F. Kennedy, Ted Kennedy, Barack Obama and a great many more Democrats. We also honor Dwight Eisenhower and Colin Powell. Though few.... there are Good Republicans. |
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Grow up. This forum is not just about Puerto Rico economics or political stories of your liking. |
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You have no authority to tell anyone to leave this forum. He has been a positive force and is more objective that you You constantly harp about the same old misery and tired stories. You have NOTHING positive to relate, so I'd rather see you leave! |
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Upfront Rican,,,you dont know, but JFK cut taxes just like the republicans do. You are a socialist like obama,,and you and him will sell Puerto Rico and the USA out....just wait in one more year!
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he is not objective,,,he keeps on saying how great the democrats are with their socialistic ideals! All I am reporting is the truth of PR with high murder rates, high drug abuse, hight domestic violence, in an island that promotes,,,''the island of enchantment'',,,,,so who is lying now!??? face the facts,,or can you handle it??DONT THINK SO,,, Puerto Rico is a lie,,dont vistit Puerto Rico! |
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Daily Horoscope for December 20
Aquarius
This is another day when financial matters cause trouble, as Mars reverses in your seventh house. What started off as a minor niggle with a partner or an opponent yesterday could now escalate into a full-blown row, but at least this will give you the chance to get certain things out into the open. Legal issues from the past may become ugly. If you're pointing the finger of blame at someone, don't get so heated that you accuse them of everything under the sun.
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