Tuesday, July 14, 2015

the fall of puerto rico - prepare yourself accordingly...,

NYTimes |   If a meeting on Monday between Puerto Rico and its creditors is any indication, restructuring the island’s $72 billion in debt could be a long process.

At that meeting, the commonwealth’s finance team said it had not yet determined how it would seek to revamp the island’s obligations.

The roughly 350 creditors, such as hedge funds and money managers, that had packed into a Park Avenue auditorium on Monday afternoon were told they would have to wait several more weeks until a working group made up of Puerto Rico political leaders came up with formal recommendations for ending the island’s fiscal crisis.

“I ask for your patience while we develop a credible plan that meets all of our stakeholders’ objectives,” Melba Acosta Febo, the president of the Government Development Bank for Puerto Rico, told the creditors gathered at Citigroup’s executive headquarters.

The meeting, which lasted more than an hour, was the first time that creditors heard directly from Puerto Rico officials since Gov. Alejandro GarcĂ­a Padilla declared two weeks ago that the island’s debt was not payable.

The government spent most of its presentation on Monday reiterating the bleak condition of the island’s economy and calling for drastic measures like cutting sick leave for local workers and lowering the minimum wage to jump-start hiring. It has more municipal bond debt per capita than any American state.