Trump Sends Puerto Rican Bond Market Into Freefall, WH Backtracks

Trump Sends Puerto Rican Bond Market Into Freefall as White House Frantically Backtracks

Trump’s Big Mouth and Grand Promises Puts The Puerto Rican People Into An Even Tighter Economic Bind

To call Donald Trump’s visit to Puerto Rico a bizarre, unhinged debacle would be an understatement. And now, as Think Progress reports, he has added to the weirdness by telling Geraldo Rivera that he would wipe out the territory’s $72 billion debt.

“You know, they owe a lot of money to your friends on Wall Street, and we’re going to have to wipe that out. That’s going to have to be — you can say goodbye to that. I don’t know if it’s Goldman Sachs, but whoever it is — you can say goodbye to that. We have to do something about this.”

It seems to be a completely off-the-cuff statement and no details on how exactly this debt will be wiped out were given. But it sure sounds good, right?

Well, it wasn’t such good news for White House budget director Mick Mulvaney who has been forced into damage control over this. He was asked by CNN if Trump is indeed about to attempt to wipe out Puerto Rico’s debt.

“I wouldn’t take it word for word with that.”

Uh huh. Okay, so, once again, Trump has just blurted out something that can’t possibly take seriously. Does that guy ever stop to think? If he had, maybe he would have realized the impact the words of the President can have. And in this case, Trump basically threw Puerto Rico, whose economy is already in tatters, under the bus.

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As CNBC reports, after Trump’s remarks, the island’s general obligation bonds took a huge dive from 44 cents on the dollar on Tuesday down to 32.75 cents on the dollar.

What in the living heck was Donald Trump thinking? Oh right, that doesn’t seem to be something he does before he opens his mouth. The fact is, he cannot actually do what he stated he will do according to the head of US macro strategies at ACG Analytics, Larry McDonald.

“This is not something a president should be doing or can do. It’s just noise, and it’s pretty far removed from reality. This is not a dictatorship. We have bankruptcy judges and the rule of law. But it is scaring the bond market.”

So, essentially, Trump just said he would do something that he can’t do and instantly did a ton of damage to Puerto Rico’s economy. With a president like this, who needs enemies?

As the Washington Journal reports, the head of fixed-income trading at Deutche Bank Private Wealth Management (wow, that’s a mouthful), reiterated that Trump has no power to do what he has promised to do.

“The president can say whatever he wants, but the decision is not his to make.”

And that’s the problem right there. The President can, and too often does, say whatever he wants, not thinking about the consequences.

 

 

Chris Hearn is an ageing freelance writer located in wintery Winnipeg. He is a stay-at-home-parent, amateur stand-up comedian, and a guy with a lot of opinions, much to everyone’s dismay.