3 ms·
Sovereign nations can default if the debt is nominated in a different currency (which was the case of Russia, but is not the case for US)
by sega_sai 5y ago
Sovereign nations can default if the debt is nominated in a different currency (which was the case of Russia, but is not the case for US)
- darawk 5y agoNo, they can default even when it is denominated in their own currency, which is what Russia did. https://en.wikipedia.org/wiki/1998_Russian_financial_crisis https://en.wikipedia.org/wiki/1998_Russian_financial_crisis Most countries just choose not to do this. They weren't forced to default. They could have chosen to monetize their debt. They just didn't choose to do that.
- User23 5y agoA sovereign could choose to default even if they somehow had a net surplus. Because, you know, sovereign literally means you can do whatever you want up to some more powerful foreign sovereign invading, because you have a local monopoly on violence.