Why Puerto Rico Is Our Greece?


Would Puerto-Rican crisis remind you of Greece’s situation 4 years ago?

Say Yes!

Striking Similarities:

  1. same relative size compared to their respective mainland counterparts
  2. similar cultural differences versus their “mainland”
  3. both being the vacation destinations for arrogant “Northerners”
  4. both have shrinking populations
  5. both had chronic budget deficits, potholed tax collection, and poor tax
  6. reporting system
  7. I have many friends at both:)

Puerto Rico vs Greece

What can we learn from the Greek crisis, though?

  1. The crisis would last a really long time. This is a today’s headline from BBC: “Greece hopeful of a deal on next bailout loan tranche.”
  2. Bondholders should and would take a cut.
  3. No serious investor had any illusions before, therefore… Eat it!
  4. Ultimately, it requires structural reform which is painful.
  5. At the worst point for during the debt crisis, it is a terrific time to scoop up those distressed bonds.

Do you see those similarities too? Anything to add?

Why Puerto Rico Is Our Greece?

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