Detroit Defaults: Won't Pay Back $2.5 Billion; Holds Back $1.25 Billion For Safety, Neighborhood Blight Elimination; Has NOT Filed For Bankruptcy Protection

Follow Detroit's recent financial history here, as well as the financial history of cities which have defaulted and others which may default. Detroit has NOT filed for bankruptcy. They just won't pay $2.5 billion it owes for unsecured loans.

Breitbart is reporting, from the AP:

Emergency manager: Detroit won't pay $2.5B it owes.

Kevyn Orr said Friday that Detroit is asking creditors to take about 10 cents on the dollar of what they're owed. Underfunded pension claims will get less.

Orr spent about two hours Friday morning with dozens of people representing banks, insurers and companies holding Detroit debt. He told reporters earlier at an airport hotel in Romulus he wants to fix fiscal problems that have made the city insolvent.

He has instituted a moratorium on all of Detroit's payments on unsecured debt, seeking forgiveness of millions of dollars owed by the city.

But something seems a bit ingenuous. The manager will default on $2.5 billion, but he will set aside $1.25 billion over 10 years for public safety, lighting, and "neighborhood blight elimination."