Technically, a technical default may still be avoided, but it is now unlikely. As the following presentation from JPM's Vladimir Werning shows, the market has already decided what the "next most likely big picture step" will be. The big question is what the less than big picture next steps will be. And as the following flow chart of options to all "potentially" impaired parties shows, there are quite a few possible steps as the variety of causal permutations has suddenly exploded. For everyone who has gotten sick and tired with following the sovereign default story of one Greece and Spain, please welcome... Argentina, where things are about to get a whole lot more interesting.
Next steps: A nerve-wrecking December for bondholders on all sides.
Risk of “technical default”: Where does it lie within the payment chain and why?
Risk of “technical default”: A payment chain is as strong as its weakest link