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By a vote of 297-127, the House approved the bill, sending it to the Senate for consideration.
Some leading Democratic senators have voiced concerns about provisions, including one that potentially could reduce the minimum wage for young Puerto Ricans.
After Washington DC’s experience with the minimum wage, I would have thought that Democrat Senators would understand the job-killing result of minimum wage legislation.
Is Peurto Rico in trouble? Yes, that is what DISTRESSED means for their bonds.
The problem is that Puerto Rico has a declining population and their government expenditures were not decreased proportionately.
I would have suggested to House Republicans that Puerto Rico scale its public expenditures to the size of the population because Puerto Rico can’t possibly last (fiscally speaking) by further expanding government expenditures.
The good news? There was one Puerto Rican bond that traded today and its price was higher (66.354) than the previous price for several days.
The yield to maturity? How does 12.755% grab you?
Is this the end of the Puerto Rican crisis? I wish the Federal Control Board (an ominous sounding Soviet-era entity) luck with dealing with cutting government expenditures with a declining population.
Say, I volunteer to serve on the Federal Control Board pro-bono. That is, if they promise to fly me down to play Royal Isabela golf course. Otherwise, I think we will be continually revisiting Puerto Rico and its default likelihood.
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