There was likely a collective gasp at OppenheimerFunds Inc. yesterday when President Donald Trump made another of those market-moving pronouncements, telling Fox News that Puerto Rico’s debt would have to be wiped out. The President’s remarks suggested he thought the losers would be Wall Street banks. The President stated: “You know they owe a lot of money to your friends on Wall Street. We’re gonna have to wipe that out. That’s gonna have to be — you know, you can say goodbye to that. I don’t know if it’s Goldman Sachs but whoever it is, you can wave good-bye to that.”
The reality is that a large percentage of Puerto Rico’s debt is held in tax-free municipal bonds and municipal bond mutual funds, owned not by Wall Street banks or tycoons, but by mom and pop investors seeking tax-free income….Wall Street On Parade
Puerto Rico’s Debt Is Quietly Sitting in Mom and Pop Mutual Funds as Trump Says It Will Be Wiped Out
Pam Martens and Russ Martens
3 comments:
Yup.
Mutual funds taking money out of the mouths of the poor. Nice.
"Wiped out" is open to interpretation.
My interpretation is that the P.R. relief legislation will contain funds to pay off P.R.'s debt.
In other words, the bad loans that P.R. would never have been able to pay off, and Wall Street would have had to take a loss on, will be paid by Uncle Sugar.
P.R. will never see a penny of the money. It will all go to Wall Street.
Congress should just write a check to pay off all the PR bonds and give them an extra 50 billion to make the island great again. Puerto Rico needs infrastructure badly if they are ever to raise productivity.
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