Background
Back in March of last year, Lebanon defaulted on its debt and has since been in a state of abject discombobulation. But the effects of this just seem to add on effect to a country that is already suffering from a big refugee crisis, which in itself was not caused by the default:
Foreign currency inflows have slowed, Lebanon’s pound has plunged in value and banks have imposed tough restrictions on dollar withdrawals and transfers. Local banks, which own a chunk of the Eurobonds maturing on 9 March, had argued against a default, saying it would pile added pressure on a cash-strapped banking sector and compromise Lebanon’s ties with foreign creditors.
Zimbabwe did default but had much more inflation. The Weimar Republic didn't default until 1932, and its hyperinflation occurred long before that in 1921 - 1923. So there are consequences that are clearly bad but not necessarily directly associated with defaulting. And it has happened many times throughout history, many without getting much long term notoriety.
Because of defaulting not causing a consistent consequence, I wanted to ask the following:
Question
What happens to a country that defaults on its debt, regardless of any other financial issues going on?
