Bonds & Interest RatesSovereign Debt
The King Who Kept Defaulting
Philip II of Spain didn't pay his debts four times
The king of an empire full of American silver stopped paying his bankers four times. So why did they keep lending to him?
You'll find out
- How often Philip II stopped paying
- What his lenders got back
- Why lending to him still paid
Why it matters
Even the richest borrowers miss payments. Lenders who know it charge for the risk, and that's what interest is.
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