The vast majority of countries have called for the creation of a framework for sovereign debt restructuring.

Devaluation and debt restructuring worked.

A country drowning in debt needs debt restructuring.

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

Calls for immediate debt restructuring went unheeded.

The Lethal Deferral of Greek Debt Restructuring

The Root of All Sovereign Debt Crises

A New Approach to Eurozone Sovereign Debt

Securitization made debt restructuring difficult, if not impossible.

Alternatives to a debt restructuring are fast disappearing.

If the banking system were well regulated, with banks holding sovereign debt having purchased insurance, an involuntary restructuring should perturb financial markets less.

They also believed that the first debt restructuring would lead to debt sustainability.

The international community has, so far, failed to develop effective and equitable arrangements for restructuring sovereign debt, despite the clearly dysfunctional and problematic consequences of past international public debt crises.

Investors were not worried about default risk on Spanish or Irish sovereign debt, or about Italy s chronically large sovereign debt.

But the ongoing legal saga of Argentina s fight with holdout creditors shows that the international system for orderly sovereign debt restructuring may be broken.

Lee Buchheit, a leading sovereign debt attorney and the man who managed the eventual Greek debt restructuring in 2012, was harshly critical of the authorities failure to face up to reality.

Absent external assistance and a credible plan for restoring fiscal order, Greek sovereign debt could not be rolled over, forcing a default, probably in the form of a restructuring of Greek debt.

Debt restructuring would have given Europe the reset it needed.

Coercive restructuring of insolvent banks unsecured debt would be next.

The truth is that Greece needs more than just debt restructuring or even debt relief.

But that begs the question why should an involuntary restructuring lead to worse contagion than a voluntary restructuring of comparable depth? If the banking system were well regulated, with banks holding sovereign debt having purchased insurance, an involuntary restructuring should perturb financial markets less.

If this principle prevails, no one would ever accept debt restructuring.

No debt restructuring took place and, small surprise, Russia's economy collapsed.

The inapplicability of Chapter 9 makes orderly debt restructuring very difficult.

This means no cross border sovereign debt (or esoteric instruments, such as collateralized debt obligations).

NEW YORK Nothing illustrates better the political crosscurrents, special interests, and shortsighted economics now at play in Europe than the debate over the restructuring of Greece s sovereign debt.

But, as we know from experience, there is life after debt restructuring.

So it is not debt restructuring, but its absence, that is immoral.

Financial markets have reacted so strongly because investors now comprehend that sovereign debt is the debt of a sovereign that can simply decide not to pay.

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

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

Virtually every emerging market country has experienced recurrent sovereign debt problems.

Unfortunately, however, ideas for debt restructuring mechanisms remain just that purely theoretical constructs.

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

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

With the onset of the European sovereign debt crisis in 2010, banks appetite for public debt fell again.

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

Fifth, debt burdens that cannot be eased by growth, savings, or inflation must be rendered sustainable through orderly debt restructuring, debt reduction, and conversion of debt into equity.

That is why every debt crisis, sooner or later, ends in restructuring or default.

Will the European Union s sovereign debt woes spread to neighbors such as Turkey?

Eurozone sovereign debt turned out not to be homogenous with respect to risk.

And how often do we hear about sovereign restructurings of local currency debt?

What Europe and the IMF have essentially done is to convert a private debt problem into a sovereign debt problem.

Nonetheless, Argentina s latest debt trauma shows that the global system for sovereign debt workouts remains badly in need of repair.

More importantly, through its numerous rescues of sovereign states, the IMF has acquired expertise in debt restructuring, while developing a reputation for toughness and impartiality, which would be very useful in these situations.