Sovereign Debt at Square One

The Root of All Sovereign Debt Crises

Sovereign debt restructuring

Sovereign debt no longer looks stable.

The sovereign debt and banking crises have become even more closely interlinked as banks bought greater amounts of their home countries sovereign debt.

The sovereign debt crisis is well known.

Sovereign debt for sustained development

Need for systemic coherence in managing sovereign debt

And the evidence confirms that the euro crisis is not really about sovereign debt, but about foreign debt.

Conclusions 406 (XL). Debt issues . 40

A New Approach to Eurozone Sovereign Debt

Sovereign debt restructurings with private creditors

Greek sovereign debt has been downgraded to below that of Egypt.

Conclusions 406 (XL). Debt issues

The link between sovereign debt and bank debt has to be broken once and for all.

In Europe, risks spreads are rising on Italian and Spanish sovereign debt.

And it probably would require that the EU be able to issue sovereign debt.

The economists Carmen Reinhart and Kenneth Rogoff have studied centuries of sovereign debt crises, and remind us that today s developed world has a forgotten history of sovereign default.

The risk premia on the sovereign debt of Greece, Ireland, and others have not diminished.

But, for the most part, the sovereign default process is slow motion Kabuki theater.

High levels of sovereign debt, together with the behavior of parts of the financial sector, have amplified the crisis in the eurozone and raised important issues of confidence that now require a systemic answer.

Policy asymmetry is greatest for the countries most acutely affected by the sovereign debt crisis.

Currently, they are wrestling with widening sovereign debt problems and high unemployment.

Portugal might follow Greece in a sovereign default and in leaving the eurozone.

Interest rate spreads on Italian sovereign debt have widened, but not sharply.

3. Debt issues in a development context, including the recent evolution of debt rescheduling.

Sovereign debt was eventually restructured through the creation of Brady bonds.

Much is being made of high levels of sovereign debt on both sides of the Atlantic, and in Japan.

The convergence of sovereign debt yields implied and required by the establishment of the common currency need not return.

The first relies on intervention by the central bank in the event of a threat to the sovereign debt market.

Some sort of Brady bond to reduce and extend excessive sovereign debt will be necessary.

a An option was included to convert US 30 year bond into a US 12 year bond with debt reduction.

The IMF sovereign debt restructuring mechanism (SDRM) proposal failed to gain support.

A sovereign debt restructuring mechanism, collective action clauses in sovereign bond contracts and a code of conduct for private creditors and sovereign debtors have all been proposed.

Item 3. Debt issues in a development context, including the recent evolution of debt rescheduling

Until this summer, the sovereign debt crisis was confined to three small countries Greece, Ireland and Portugal.

So governments bailed out banks and economies, producing a sovereign debt crisis.

Indeed, restructuring undermines the foundation of the entire financial system the safe asset role of sovereign debt.

The country s sovereign rating is AA , not AAA, as it was 16 years ago.

The drama of the European sovereign debt crisis with Greece in its center is coming to a head, as politicians desperately seek options to disentangle the European Union from mounting debt.

The European Commission s claim that this slowdown reflects high sovereign default risk, rather than fiscal consolidation, is belied by the UK, where the sovereign risk is deemed by markets to be virtually nonexistent.

Until the late 1990 s and the advent of monetary union, most government debt in the European Union was domestically held in 1998, foreigners held only one fifth of sovereign debt.

In 2001, IMF made a proposal to design an SDRM based on private sector bankruptcy laws to provide a legal framework for an orderly restructuring of sovereign debt owed to private creditors.11 However, it has so far failed to garner sufficient support among private and Paris Club creditors whose concerns included the moral hazard, the neutrality of IMF in the process and the increase in borrowing costs.

After the Argentine crisis, President George W. Bush s administration vetoed proposals to create a mechanism for sovereign debt restructuring.

ROME The euro contagion triggered by Greece s sovereign debt crisis has now infected Italy.