Puerto Rico general obligation bonds fell to 36 cents on the dollar after Trump told Fox News on Tuesday night that Puerto Rico’s debt will have to be wiped out.

Looking back, bonds prices started the collapse in 2014, well before Trump comments and well before hurricanes.

Puerto Rico borrowed billions of dollars, more than any state in the US except California and New York for energy infrastructure, but the money did not shore up its aging infrastructure.

Where did the money go?

Puerto Rico Bond Prices

Puerto Rico Infrastructure

Wipe Out the Debt

CNBC reports Puerto Rico bonds plunge to just 36 cents on the dollar after Trump pledge to wipe out debt.

On Tuesday night, he told Fox News that Puerto Rico’s debt will have to be wiped out. “They owe a lot of money to your friends on Wall Street and we’re going to have to wipe that out. You’re going to say goodbye to that, I don’t know if it’s Goldman Sachs, but whoever it is you can wave goodbye to that,” Trump said.

“This is not something a president should be doing or can do,” said Larry McDonald, head of the U.S. macro strategies at ACG Analytics. “It’s just noise, and it’s pretty far removed from reality.”

“This is not a dictatorship. We have bankruptcy judges and the rule of law,” McDonald said. “But it is scaring the bond market.”

Puerto Rico currently holds more than $70 billion in debt in part because of years of government overspending. Cate Long, founder of Puerto Rico Clearinghouse, told CNBC in an email that in aggregate, about 75 percent of it is held by retail investors

Squawk Box Video

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After years of overspending and racking up massive amounts of debt, the average age of Puerto Rico’s petroleum-powered energy plants is 44 years vs an 18 year-average in the US.

44% of Puerto Rico’s electricity is from petroleum vs 0.6% in the US.

On top of $70 billion in debt, Puerto Rico has $123 billion in unfunded liabilities.

Where the hell did the money go?

Mike “Mish” Shedlock