Listen To The Story
Marketplace

Puerto Rico’s billions of dollars in outstanding debt involves a complicated mix of obligations: general government bonds sold by Puerto Rico, sales tax-backed bonds, electric power revenue bonds … it’s a long list. Bond insurers are on the hook for a portion of the debt if the government agencies that issued the bonds fail to pay interest and principal. Mutual funds and hedge funds stand to lose in the debt restructuring, but so do small investors. About 40 percent of the territory’s outstanding bonds are held by Puerto Ricans in individual retirement accounts and local banks. And as for President Donald Trump’s power to intervene in some way in the debts owed to Wall Street firms and “wipe that out”? There’s no legal precedent for unilateral executive branch action given that Congress has already passed a law governing Puerto Rico’s bankruptcy and a federal judge is now adjudicating the complicated debt restructuring case.

Click the audio player above to hear the full story.

“I think the best compliment I can give is not to say how much your programs have taught me (a ton), but how much Marketplace has motivated me to go out and teach myself.” – Michael in Arlington, VA

As a nonprofit news organization, what matters to us is the same thing that matters to you: being a source for trustworthy, independent news that makes people smarter about business and the economy. So if Marketplace has helped you understand the economy better, make more informed financial decisions or just encouraged you to think differently, we’re asking you to give a little something back.

Become a Marketplace Investor today – in whatever amount is right for you – and keep public service journalism strong. We’re grateful for your support.

Follow Mitchell Hartman at @entrepreneurguy