Slashing of living standards, mass starvation, and acceleration
of sovereign debt default come immediately to mind.
The American Enterprise Institute for Public Policy Research recently published a study that indicated that «by all relevant debt indicators, the U.S. fiscal scenario will soon approximate the economic scenario for countries on the verge
of a sovereign debt default.»
«When countries that had public finances in a comparable state to ours last May are still fighting off the terrible spectre
of sovereign debt default, it would be terrible folly to slow the pace of what is widely regarded as a necessary fiscal consolidation.
More generally, the European Union (EU) is perceived by many to be in crisis, buffeted by the twin threats
of sovereign debt default...
Not exact matches
What we don't know the state
of credit
default swaps held by banks against
sovereign debt and against European banks, nor do we know the state
of CDS held by British banks, nor are we certain
of how certain the exposure
of British banks is to the Ireland
sovereign debt problems.»
Based on the cost
of insuring Venezuelan
sovereign debt, the markets are estimating an 80 percent chance
of a
default within the next year.
Partial
debt forgiveness has been a formal part
of nearly every
sovereign default or
debt restructuring in modern history, although usually not until there has been a long and painful period
of angry posturing and one or more partial restructurings.
For a third example, not everyone in the early 1960s believed that the USSR would inevitably overtake the US economically before the end
of the century, but excluding fierce anti-Communists predicting fire and brimstone, I don't know anyone who expected that by the 1980s the USSR would essentially be insolvent (technically it wasn't, but LDC
debt traders nonetheless included the country in their universe
of defaulted or restructuring
sovereign borrowers).
Between June and July 2015, it appeared that the divergences separating the Greek far - left Tsipras government and its EU and international interlocutors had the potential
of leading to a
sovereign debt default.
Compared to most other countries»
sovereign debt, there is little risk
of a U.S.
debt default.
«Before Brexit, there was Grexit and the European
sovereign debt crisis, Scotland's independence referendum, and the U.S. legislative gridlock over its
debt ceiling in 2011, which threatened to, out
of whole cloth, create a
default in the global benchmark risk - free asset,» Zezas adds.
Before Brexit, there was Grexit and the European
sovereign debt crisis, Scotland's independence referendum, and the U.S. legislative gridlock over its
debt ceiling in 2011, which threatened to, out
of whole cloth, create a
default in the global benchmark risk - free asset.
A rise in the global lending rate increases the cost
of servicing
debt and magnifies the risk
of sovereign defaults in general.»
A
sovereign debt default is never a pleasant experience, least
of all if it is a country the size
of United States.
The global financial markets have paid some
of the consequences
of defaulted sovereign debt.
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Debt / GDP Ratio,
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Additional risks include exposure to less developed or less efficient trading markets; social, political or economic instability; fluctuations in foreign currencies or currency redenomination; potential for
default on
sovereign debt; nationalization or expropriation
of assets; settlement, custodial or other operational risks; and less stringent auditing and legal standards.
The issuer
of the
sovereign debt or the authorities that control the repayment
of the
debt may be unable or unwilling to repay principal or interest when due, and the Fund may have limited recourse in the event
of a
default.
Regardless
of the concerns, many are expecting that South Africa may be able to avoid receiving a fourth credit score downgrade at less than a calendar year due to a decline in the cost
of insuring the nation's
sovereign debt against
default utilizing credit -
default swaps.
* On an overall basis, the report states that while «global tail risks have diminished (meaning the risk
of a systemic shock to the global financial system that could be caused by an event like a
sovereign debt default), the global outlook is slightly weaker than projected in October».