If there is no functioning modern economy, the government will not be able to pay its debts.
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The lira has fallen more than 40 percent against the dollar this year, as investors' fears rapidly escalated that the country would not be able to pay its debts.
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In more recent years, as it began to look like Puerto Rico wouldn't be able to pay its debts, holders of Puerto Rican bonds began dumping them and specialist distressed debt investors started picking them up at a discount.
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Before any new policies are enacted, there must be a recognition that if Puerto Rico is to be put on a sustainable fiscal and economic path to be able to pay its debts, an extreme austerity-only approach to fiscal policy is not the answer.
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Legal capital must be maintained (not distributed to shareholders, or distributed "in disguise") unless a company formally reduces its legal capital. Then it can make distributions, which might be desirable if a company wishes to shrink. A private company must have a 75 per cent vote of the shareholders, and the directors must then warrant that the company will remain solvent and will be able to pay its debts.
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El Paso generated profits of $283,000 during the pipeline's first year of operation but the Depression-era economy threatened to quash the venture. Fortunately, the city of El Paso continued to buy Kayser's gas. The company was able to pay its debts and to expand its pipeline system during the early 1930s. The company built new lines extending to the copper mining areas of southern Arizona and northern Mexico and in 1934 extended service to Tucson and Phoenix, Arizona.
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Van Hove held the property until 1621, when the Staten van Vlaanderen (formerly the Vier Leden) was able to pay its debts and reacquire it. After regaining the property, the Staten van Vlaanderen promptly auctioned it off to the highest bidder, an Italian businessman named Jacomo Antonio Carenna, who then became Lord of Zwijndrecht and Burcht. In 1666, he divided the property between his two sons, Jan Francisco Carenna (Zwijndrecht) and Ignacius Carenna (Burcht). Burcht and Zwijndrecht became separate villages and remained so until they were reunited as the municipality of Zwijndrecht in 1977.
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The reductions were fought for by gentry, tradesmen, state servants, and peasantry alike, partly as a way to curb the power of the great aristocratic families and partly as a way to make the state solvent and able to pay its debts. One such reduction, () under Charles X Gustav of Sweden in 1655, intended at restoring a quarter of "donations" made after 1632. However, the outbreak of the Second Northern War prevented its realisation. Only after Charles XI's entry into maturity in 1672, it began to be implemented effectively.
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Van Hove held the property until 1621, when the Staten van Vlaanderen (formerly the Vier Leden) was able to pay its debts and reacquire it. After regaining the property, the Staten van Vlaanderen promptly auctioned it off to the highest bidder, an Italian businessman named Jacomo Antonio Carenna, who then became Lord of Zwijndrecht and Burcht. In 1666, he divided the property between his two sons, Jan Francisco Carenna (Zwijndrecht) and Ignacius Carenna (Burcht). Burcht and Zwijndrecht became separate villages and remained so until they were reunited as the municipality of Zwijndrecht in 1977.
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However, whereas the failure of banks during the Panic of 1837 caused the government great embarrassment, bank failures during the Panic of 1857 did not, as the government, having its money in its own hands, was able to pay its debts, and met every liability without trouble. In his December 7, 1857 State of the Union message, President James Buchanan said: In order to prosecute the Civil War, Congress passed the acts of 1863 and 1864 creating national banks. Exceptions were made to the prohibition against depositing government funds in private banks, and in certain cases payments to the government could be made in national bank notes. After the Civil War, the independent Treasury continued in modified form, as each successive administration tried to cope with its weaknesses in various ways. Secretary of the Treasury Leslie M. Shaw (1902–1907) made many innovations; he attempted to use Treasury funds to expand and contract the money supply according to the nation’s credit needs.
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