Worrying news for Greece and for other countries looking for major bail-outs.
Treat all sides fairly! Or else the lawsuits start.
But what if treating all sides fairly just isn't possible?
A mess. But much more than a mere mess. A mess that changes the rules:
Reuters’ Felix Salmon, who has followed the story closely, sees Argentina’s bind (and the broader ruling) as a major shift in world of sovereign debt:
[T]his ruling is just one more step towards a world where the old verities about sovereign risk simply don’t hold any more. It used to be that sovereigns were sovereign: that was bad news if they unilaterally decided to default on you, but other than that it was pretty good news.
Now, however, they’re at the mercy not only of unelected technocrats at places like the IMF or the ECB; they’re also at the mercy of unelected judges in New York. Sovereigns have less freedom of movement now than they have done in a very long time, and we’re only beginning to grok the implications of those constraints.
Hmm. Grok? Turns out it does mean something.
