The Day After Default

The Day After Default

Corporate & Sovereign Strategy

Weighing in: The IMF supports codifying sovereign bankruptcies. Two Latin American sovereign defaults in two years have enraged lenders and jeopardized the health of the emerging markets asset class. What's more, Argentina's collapse and the 1999 Ecuadorian default have placed monumental strains on the negotiation process between markets and governments. Years of debate over crisis mitigation has yet to provide the world with a quick and clean debt restructuring that gives creditors a reasonable deal and allows sovereigns to return to the capital markets quickly and resume normal borrowing.

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