Rescue proposals in Europe have turned on how ratings agencies define a sovereign default.
There would, in short, be a clearly defined process for dealing with sovereign default.
Further creditor haircuts and possible sovereign default seem likely to emerge from the impending meltdown.
Fearsome as the prospects of sovereign default are, bankers also fret about the impact of avoiding one.
The 2001 sovereign default crisis of Argentina only added to the devastation of the textile and clothing sector.
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It calculated that the euro zone would not risk the contagion that might follow a disorderly sovereign default.
At the same time, the cost of insuring against a Portuguese sovereign default has hit another record high.
It reduces the chances of a sovereign default triggered by inability to meet payment demands through private sector.
This fate was one of the few options left for the middle class when the 2001 sovereign default hit.
The deal means Argentina has now settled 92% of the bad debt left from its sovereign default in 2001.
But there is another, stormier possibility: that of renewed market turmoil caused by the risk of sovereign default or a euro-zone break-up.
This case, then, is one of the several moving parts that will help shape the future of sovereign default and debt restructuring.
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Latin America's third-biggest economy has been trying to rebuild its reputation with international investors, which was shattered by the 2001 sovereign default.
However, Fitch said the risk of a sovereign default was "extremely low".
Sustained deflation, Credit Suisse says, would put strains on public finances, increasing the risk of sovereign default, and making longer-term bonds less attractive.
The cynical believe this is part of a plan to federalize Europe from the shattered economic pieces of a broad European sovereign default.
The stressful scenario was pretty moderate at best and did not go so far as to test against the possibility of an outright sovereign default.
In the euro-zone crisis the threat of sovereign default renders some governments impotent, while those which could act have chosen not to do so decisively.
The gap between Spanish and German long-term borrowing rates also reached a record high, as did the cost of insuring against a Spanish sovereign default.
More fundamentally, Dubai's wobble raised the spectre of a sovereign default.
Optimism that Chinese investment will squelch the spread of sovereign default contagion sent stocks shooting to their best levels of the day by the close of trading.
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The fact that Greece is stuck with the euro would actually be an advantage in the event of a Greek sovereign default, if things were handled correctly.
No prize for predicting the winner: Reform may not be popular, but sovereign default is inconceivable in France, a country that did not have one in 200 years.
Efforts to restructure the debts that caused the biggest sovereign default in history have not even started and the first bondholder has already sued in a New York court.
But if the government does not sign up to all this, it is difficult to see how Greece avoids a formal sovereign default in the next few weeks.
Up until this point in the European debt crisis, bond holders have been held sacrosanct as no one has wanted to even consider the far-reaching consequences of a sovereign default.
The charge that some eurozone countries were seeking to engineer a Greek sovereign default and exit from the euro deepened the rancour between debtor and creditors in the dangerous standoff.
European leaders have staked their credibility on the euro succeeding as a political project, so they are reluctantly preparing the new rescue package as a last resort to prevent the eurozone's first sovereign default.
But Argentina has not been able to borrow in the markets for years, because investors demand punishing interest rates and because it is still mired in legal battles with the holdouts from its 2001 sovereign default.
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