Puerto Rico’s debt woes are an uncomfortable reminder of a much larger problem in sovereign bond markets: Minority holdouts now have the upper hand in government debt restructurings.
But unlike Washington’s proposal to legislate a fix to Puerto Rico’s debt troubles, the U.S. has no plans to push through laws that might undermine holdouts’ power more broadly.
That means a small number of people can stymie bond negotiations even if debt cuts are needed to avert the collapse of entire economies.
The problem started with a ruling by a U.S. court that forced Argentina to settle with holdout creditors after an acrimonious 15-year Read More

Source:: wsj