Sometimes Donald Trump has value he says the things other politicians would like to say, but haven't quite got the nerve to do so. So it was this week with Puerto Rican debt. The island "owes a lot to Wall Street", he told a US reporter. "We're going to have to wipe that out You can say goodbye to that."
The debt can't be paid back by Puerto Rico, and the central government isn't stepping in to cover the shortfall ("we are not going to bail out those bond holders", said Trump's budget chief). So it won't be paid back. There was pushback from Wall Street ("it's just noise", said one analyst), but the bond market took Trump at his word. Try to sell a general obligation Puerto Rican bond with a face value of a dollar this week, and you'll be lucky to get 33 cents for it (down from 56 in September).
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