Puerto Rico downgraded: Bonds reduced to 'junk' levels

Puerto Rico credit rating was dpwngraded to 'junk' status, prompting Governor Padilla to order budget cuts for government agencies. News of Puerto Rico's credit being downgraded caused its yields on the S&P 500 to rise Wednesday.

|
Alvin Baez/Reuters/File
Advertising covers the abandoned shell of an unfinished condominium building in the Condado tourist district of San Juan. Standard & Poor's on Tuesday downgraded Puerto Rico's credit rating to junk status, making it harder for the cash-strapped Caribbean island to borrow in America's $3.7 trillion municipal bond market.

Puerto Rico's governor says he is renegotiating the payment of short-term debt and has ordered all government agencies to reduce their current budgets by 2 percent after the island's credit rating was downgraded to junk status.

Alejandro Garcia Padilla made the announcement Wednesday on radio station WKAQ.

Spokeswoman Paola Figueroa tells The Associated Press that the governor will make additional announcements later Wednesday in response to the downgrade.

Garcia said Tuesday that he also would be submitting legislation to further reduce the deficit and would present a deficit-free budget for the upcoming fiscal year.

Puerto Rico is in its eighth year of recession while struggling with $70 billion in public debt and a 15.4 percent unemployment rate, higher than any U.S. state.

You've read  of  free articles. Subscribe to continue.
Real news can be honest, hopeful, credible, constructive.
What is the Monitor difference? Tackling the tough headlines – with humanity. Listening to sources – with respect. Seeing the story that others are missing by reporting what so often gets overlooked: the values that connect us. That’s Monitor reporting – news that changes how you see the world.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

QR Code to Puerto Rico downgraded: Bonds reduced to 'junk' levels
Read this article in
https://www.csmonitor.com/Business/Latest-News-Wires/2014/0205/Puerto-Rico-downgraded-Bonds-reduced-to-junk-levels
QR Code to Subscription page
Start your subscription today
https://www.csmonitor.com/subscribe