Puerto Rico’s Worst Case Scenario: R-E-C-O-V-E-R-Y

by Richard P. Larkin
Published October 10, 2013

Much has been said and written about Puerto Rico, its economy and finances. This report purposely runs contrary to recent bombastic media coverage, puts issues in proper perspective, and is consistent with Dick larkin’s previous opinions on Puerto Rico’s creditworthiness. In the report, you will find that:

  • It pulls no punches regarding the economic and financial condition of the Commonwealth of Puerto Rico;
  • It chronicles the remarkable and unprecedented fiscal recovery plan that has been accomplished in the last 10 months, including strong revenue collections so far this year;
  • It details the extent of Puerto Rico’s Pension Funding and projects its solvency through 2021;
  • It indicates that the Commonwealth’s austerity measure have not been without economic fall-out;
  • It discusses a conference of Puerto Rico “credit experts” and their comments regarding Puerto Rico through last week;
  • It lists 10 reasons why Commonwealth of Puerto Rico debt remains a sound investment for stable tax free income, even in the unlikely event of a debt restructuring; and
  • It comments on recent remarks of hedge fund managers that have little or no experience in tax-exempt debt, let alone experience with municipal bankruptcy, and warns that there are significant changes in the institutional investor sector of tax-exempt bonds, not necessarily for the better.

download the full report

The material presented here is for information purposes only and is not to be considered an offer to buy or sell any security. This report was prepared from sources believed to be reliable but it is not guaranteed as to accuracy and it is not a complete summary of statement of all available data. Information and opinions are current up to the date of publication and are subject to change without notice. The purchase and sale of securities should be conducted on an individual basis considering the risk tolerance and investment objective of each investor and with the advice and counsel of a professional advisor.

The opinions expressed by Mr. Larkin are strictly his own and do not necessarily reflect those of Herbert J. Sims & Co., Inc. or their affiliates. This is not a solicitation to buy or an offer to sell any particular investment. All investment involves risk and may result in a loss of principal. Investors should carefully consider their own circumstances before making any investment decision.

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