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A comment on The Collapse of SVB Exposes the Largest Crack in the Economy. Parent comment

Re:The Collapse of SVB Exposes the Largest Crack in the Economy by andrepd on Friday March 10, 2023 @08:27PM (#35104052)
My country has an 8% budget surplus before interest payments, and 2% deficit after. What would be the consequences of ignoring/defaulting on that debt exactly? Seeing as how it's already doing fine with an 8% surplus.

I can think of other (political) consequences, but not economical per se, if you assume that a loan has a risk of default priced into its interest rate.

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Re:The Collapse of SVB Exposes the Largest Crack in the Economy by JackFr on Friday March 10, 2023 @09:34PM (#35104526)
The obvious consequence of defaulting in your debt is that it becomes difficult to go to the capital markets in the future if you need to.

Probably more politically disastrous is that if the debt is denominated in the domestic currency, it’s likely that a substantial portion of the bond holders are domestic and they will not be happy about having their wealth confiscated.

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