We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Nobody downloaded yet

Journal opinion article - Essay Example

Comments (0)
Summary
Instructor Date Puerto Rico's Debt Trap Puerto Rico’s economy was in crisis with a debt obligation of 3.3 billion dollars when the new governor, Luis Fortuno of the New Progressive Party took charge in 2008. In order to stabilize the economy, a new budget was framed that required government job cuts to the extent of 38000…
Download full paper
GRAB THE BEST PAPER
Journal opinion article
Read TextPreview

Extract of sample
Journal opinion article

Download file to see previous pages... Puerto Rico debt obligations have ashamed the debt obligations of Detroit. Detroit which had 7 hundreed throusand residents went bankrupt for piling up debt obligations of 18 billion dollars which were not serviced. In comparison to this, the condition of Puerto Rico is severely devastating with the figures of debt obligations that are unfunded in various obligations and pension funds of 3.5 million residents remaining unserviced. The debt obligation has grown to a whopping amount of 87 billion dollars and the government has reached a situation where they are going to run out of funds. The island of Puerto Rico has been expecting a bailout from the US administration in order to save their economy. However, real facts indicate otherwise with news of the US brokerage firms advising investors to stay out of investing in the bonds of Puerto Rico that they plan to use to finance their debt obligations. In order to attract the investors, Puerto Rico has issued bonds with a forecasted yield of 9.29% which exceeded that of Greece. For this reason, Puerto Rico is being referred as Greece of America. In 2008, the measures taken by the government to stabilize the economy created a situation of debt trap for the territory of Puerto Rico. The governor at that point of time undertook measures like cutting down government jobs, reducing income taxes to half as well as reducing the corporate tax rate by about 9%. These measures were undertaken by looking at the limitations of government in funding the economic investments and their abilities to meet the level of expenditure with an eye on the treasury. The steps were also taken to maintain an optimum level of liquidity in the economy and contain inflation by restoring a balance between the demand and supply in the economy. The level of government job cuts reduced the expenditure of the government in terms of payment of salaries. Although this provided relief to the policy makers in the short term, the government job cuts also led to decrease in production volumes. The decrease in production volumes meant that the supply of goods and service decreased. The slowdown of the GDP led to the reduction in the earnings of revenues of the government. Although, the government of Puerto Rico tried to maintain stability by injecting liquidity in the economy through reduction of corporate and individual taxes, the slowdown of the income level and the earnings meant that the investments and the demands also deteriorated. The revenue earnings of the government suffered and the treasury volume got depleted over a period of time. Due to this debt trap in Puerto Rico, the government ran out of funds and the economy headed towards a debt crisis. The debt crisis of Puerto Rico is slightly different from that of Greece due to the fact that a major part of its debt obligations are long term. Due to small short term debt obligations, the territory would get some more time to restore its financial status and recover from the debt obligations. The government has also taken austerity measures to control the situation of debt crisis. This includes an increase in the contribution of the state from 8.275% to 10% in the pension plans. By doing this, Puerto Rico had planned to get more funds in the pension schemes that could be used to service the debt liabilities and the long term maturities could be paid with the restoration of economy in future. The measures taken by the ...Download file to see next pagesRead More
Comments (0)
Click to create a comment or rate a document
CHECK THESE SAMPLES - THEY ALSO FIT YOUR TOPIC
Journal opinion article
The worldwide crisis in the U.S financial markets and also the sluggish growth rates in the emerging markets like China are slowing down the trade. This has become a hindrance to the global economy; thus the baby booming generations have become highly concerned about the retirement income security.
3 Pages(750 words)Essay
Journal opinion article
The period after recession and presidential election in 2012 saw changes in the policies of the government. These policies are in line with the fundamentals of economic theory on supply and demand and at the same time keeping an eye over the performance of US dollar.
3 Pages(750 words)Essay
A Journal opinion article
In addition, the worsening economic state of china could also be considered as a contributing factor for America’s emergence as the top investors’ destination. The undergoing financial recovery spear headed by the Obama’s administration could have motivated most of the confidence in United States by foreign investors.
3 Pages(750 words)Essay
Journal opinion article
China’s increasing foreign aid in the last decade is aimed at the benefits of China. The strategy behind China’s aid expansion policy follows a different model than the other developed countries and the US. While the developed countries follow a subscription policy to offer foreign aid, China has resorted to the policy of financing the volume of foreign aid.
3 Pages(750 words)Essay
A Journal opinion article
It gives the “illusion” that the company is doing well, or profitable due to its high valuation but really, it is the same stock as before (with a lower price). The practice is not healthy to the economy but it is not illegal so many companies still use this “trick” for their stocks to be valued higher and have higher returns.
3 Pages(750 words)Essay
A Journal opinion article
Of course everybody knows that ObamaCare is a health insurance sponsored by President Obama but many are still oblivious of what it is really about, why many politicians disagree about it and whether if it economically advantageous to Americans both as a country and individual.
3 Pages(750 words)Essay
Journal Opinion Article
It was clearly noted that “the relief this summer, however, is due to expected cooler temperatures, rather than cheaper rates… is partially offset by a projected 2-percent increase in average electricity
2 Pages(500 words)Essay
Wall Street Journal Opinion Article
This came after the economy of China was presumed not to grow beyond eight percent of their quarter due to the drawback that had occurred in the trade world. This consequently led investors to withdraw from engaging
3 Pages(750 words)Essay
A Journal opinion article
onsidering the launch of anti poverty campaigns by President Johnson and the calculation of Orshansky, a civil servant for determining the number of those people who are below the line of poverty. While the calculation is intriguing, it might seem to the rest of the world that
2 Pages(500 words)Essay
Journal opinion article
A repeat of a similar scenario will obviously bring sad memories to different people. However, some analysts believe that regulation can help prevent a similar situation from occurring in the future. As such, this
2 Pages(500 words)Essay
Let us find you another Essay on topic Journal opinion article for FREE!
Contact us:
+16312120006
Contact Us Now
FREE Mobile Apps:
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us