Will Puerto Rico Cause An Inadvertent “Black Swan” Derivatives Melt-Down?

I find it amusing that Greece is the word, yet no one is really saying much about the Puerto Rico $72 billion default, I mean that's not pocket change....And so we have this...

http://investmentresearchdynamics.com/will-puerto-rico-cause-an-inadvertent-black-swan-derivatives-melt-down/

MBI guarantees $4.5 billion in par amount of Puerto Rico muni paper.  As of it’s latest 10-Q (March 31, 2015), MBI showed a book value of $3.9 billion. Puerto Rico alone could more than wipe out MBI’s net worth.  But that’s only a portion of the story. The bigger part of the story is buried off-balance sheet in the footnotes in opaque financial structures called Variable Interest Entities (VIE’s). Remember those from 2008?  I remember them vividly.

But lets focus all our energy on Greece shall we...