Creditors of the state as well the economy and the citizens of the state are affected by the sovereign default.

The following list includes actual sovereign defaults and debt restructuring of independent countries from 1800 till 2012:

When a country fails to pay back its sovereign debt, this is called a sovereign default.

Myth 2: the sovereign default is the ultimate evil of the economy of one's country.

The next stage will be sovereign default and the extension of the crisis to banks, pension funds and other lenders.

Others believed that even the proposed 50% would not be enough to prevent a sovereign default.

That's why Russia and Argentina (two of the more recent sovereign defaults) are thriving now.

Yes, there's life after a sovereign default.

The chart suggests that if the historical pattern is followed, there will be soon a wave of sovereign defaults.

More generally, any sort of sovereign default would raise further questions about highly indebted, deeply imbalanced economies around the world.