Tag Archive: bankruptcy

Is Puerto Rico Just the First Domino to fall?

This week, Puerto Rico declared a form of bankruptcy as the island was left with no choice. Years of debt accumulation combined with ineffective government policies and other issues finally became too much for the island to bear, and the day of financial reckoning had arrived. This Puerto Rico bankruptcy could potentially have extremely far-reaching effects, and it should cause concern for U.S. citizens and investors. In short, the bankruptcy could bludgeon investors, undermine state and municipal governments and change the retirement plans of many.... Continue Reading

The Counterparty Risk Problem

Investopedia defines counterparty risk as “the risk to each party of a contract that the counterparty will not live up to its contractual obligations.” Now think about that for a moment… Whether you realize it or not, you have to confront counterparty risk on a daily basis. Will the power company deliver electricity to your home? Will the city or municipality provide a clean and reliable water supply? Will your health insurer pay up in the event of a claim? While all of these issues... Continue Reading

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