In its strict sense, sovereign risk describes governments defaulting on obligations but is used by some to mean any change in taxes, subsidies or regulations that are less favourable for businesses.
Treasury secretary Jack Lew expects to exhaust those measures by 17 October and the congressional budget office expects the nation could start defaulting on obligations by 22 October unless swift action is taken.
On Monday, Infinity World Development, a subsidiary of Dubai World, charged MGM Mirage with defaulting on obligations in connection with a joint venture with Infinity to design, construct and operate a development on the Las Vegas Strip called CityCenter.
At the time that the government decided to rescue AIG, an independent analyst reported that the company was on the verge of defaulting on obligations that could cause collateral losses to counterparts of as much as $180 billion.
Goldman also detailed $1.1 billion in "credit" exposure to Italy, reflecting the risk that its Italian borrowers and counterparties might default on obligations.
It is why the United States has never defaulted on its obligations and never will.
The first of these started when the Nixon administration defaulted on American obligations under the 1944 Bretton Woods agreement to balance our accounts with the world.
Until last year's market collapse, bond insurers like MBIA ran a stable, profitable business by promising to make investors whole if a government ever defaulted on its obligations.
Silar took over the portfolio last September after Compass, which operates out of the same office building and same floor in Midtown Manhattan, defaulted on its obligations.
RENEWED STRESS Credit woes intensified after an increase in mortgage foreclosures was reported and two financial companies said they had defaulted on some obligations.
If Hoosier defaulted on its obligations under the contract, Ambac would pay John Hancock an early-termination fee, then demand the same amount from Hoosier.
