The Curious Case of P. R. Bonds

     Most debtors unable to make loan payments run for protection under one bankruptcy provision or another, usually meaning their creditors and stockholders get ripped off while one way or another they keep their jobs.  Thing is, it's always you and I who take these hits.  As shareholders, bondholders, or depositors in financial institutions lending our hard-earned money to these rapscallions, nobody protects us.  Recent market meltdowns have shown how much you truly are at risk simply by keeping a savings account basically anywhere these days.

     Should a nation with its own sovereign currency run into fiscal trouble, leaders can paper over the mess by simply printing more money, thereby flooding the land - and Government coffers - with more than enough inflation-driven cash to cover the old debt.  Think repaying our own 1960's Great Society deficit spending with 1985 dollars.  Piece of cake.

     As pretty near everybody in the civilized world and Iceland knows by now, Greece can't print squat because it got talked into using this goofy multinational Euro, controlled by Frenchmen and Germans (and a few cronies who can stand being in the same room with Frenchmen and Germans) instead of their foresaken Drachma.

     Which gets us to P. R. bonds.  As an unincorporated territory, whatever that is, we're told that the Commonwealth of Puerto Rico has no bankruptcy mechanism, meaning we could finally get our money back from somebody missing payments which the Commonwealth is about to do on its bonds.  Even if it's only unincorporated territories, of which there are just twelve, that's somebody.  Screw with us, Midway Atoll, and we will rip every last dollar out of your conniving hands.  Or American Samoa or Kingman Reef or Wake Island.  We could lend Guam all the money the Guamians want and know we would collect it all if anybody there tried to stiff us.

     Thing is, Puerto Rico says it's broke.  That's okay.  If they're really broke, pay us in rum.  Nobody at the Post cares if we get paid in rum.  Or baseball players.  Send us whatever you've got, Puerto Rico. We'll buy Puerto Rican bonds if you pay them off in Don Q and Bacardi.  Or a lefty pitching prospect with some serious heat.

     It's about time somebody causing the losses took them instead of us.

     Okay, enough fantasizing.  We read that Puerto Rico has already asked Congress for bankruptcy legislation and just hired a guy who helped Detroit with theirs.

     We don't have to tell you how this is really going to end for us.  Well, those of us holding Puerto Rican bonds anyway.