Puerto Rico has triggered the biggest municipal default in US history

Ambrose Evans-Pritchard

Business Insider / The Telegraph

Puerto Rico has triggered the biggest municipal default in US history, ris-
king years of bitter legal warfare with creditors and an austerity "death spi-
ral" with echoes of Greece. The island Commonwealth finally ran out of
money on Monday after a desperate effort to stay afloat, and missed a final
deadline for a $58 million payment - handing over just $628,000. It implies
a sweeping default on much of its $72 billion debt burden, equal to 100pc
of Puerto Rico’s gross national product (GNP) and more than five times the
debt ratio of California or Texas.

The Commonwealth is now in legal limbo, facing a well-organized pack of
hedge funds that scooped up the debt at distressed levels and appears deter-
mined to extract maximum value in the courts...[CONTINUE READING]