Mexico Bracing for Massive Default That Could Set Off Global Debt Bomb: “Perversely Ironic Twist”

Saturday, December 5, 2015
By Paul Martin

Mac Slavo
December 4th, 2015
SHTFplan.com

The debt avalanches. Once it accumulates enough mass, and momentum is not sufficient to stop its collapse, it overwhelms its host, and will come crashing down on the rest of the system, too.

Across the planet, there are hundreds of governments – local, state and national – as well as business and households who are reaching a breaking point. Already drowning in debt, many are about to default on loan repayments, and thus set off a series of debt crises that will be met with market chaos and a tightening of easy credit for those who are most vulnerable to implosion.

With Puerto Rico also timed for a major default that will burden the United States, Mexico is ready to crash, and bracing for impact. Its biggest construction firm, which has been dependent upon government contracts that are now drying up, is facing default on a $31 million interest bill.

And so it begins…

via Wolf Street:

In August, the bonds of Mexico’s biggest construction company, ICA, had the dubious honor of being the worst performing corporate bonds across all emerging markets. At a time when emerging economies are slowing down and the total debt exposure of EM corporations has never been higher, this was no mean feat. […]

Yesterday the company’s shares plummeted 22% on news that it would use a 30-day grace period to make a $31 million interest payment that was due this week. Today its shares, which have lost more than 75% of their value since January, fell a further 8% to 3.76 pesos, their lowest point in 21 years.

To make matters worse, the builder recently hired corporate restructuring specialist Rothschild & Co. as financial adviser, fuelling speculation that it will soon seek debt relief.

The Rest…HERE

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