A U.S. Default? Bankruptcy Experts Say No

Take two bankruptcy attorneys, one investment banker and a distressed-debt investor and you should end up with a pretty good body of expertise for reading the warning signs of default.

As part of Daily Bankruptcy Review’s annual roundtable held at our offices in New York City, we canvassed opinions on the risk of a U.S. sovereign default from Maria Boyazny of MB Global Partners, Stephanie Wickouski of Bryan Cave, Bob Nabholz of Duff & Phelps and Adam Rogoff of Kramer Levin.

OK, so these folks are experts in corporate rather than sovereign distress, but their work also requires reading the negotiating positions and bluffing of argumentative parties in bankruptcy cases and in that sense it’s not unlike the current Washington debt-talks tussle.

Nabholz had this to say: “They’ll figure a way out….There will never be a technical default on Treasurys.  That coupon will be made, the payments will be made.  I just think it’s Washington at its worst.”

Asked to vote on whether the U.S. would default on its debt, all four of our experts voted “no.”

The full transcript of the roundtable will be published at a later date to DBR subscribers.