The core of any bankruptcy or insolvency system consists of a stay against creditor action, an ability to recover preferential payments—which both promotes equity and reduces the chances of runs on the debtor—and an ability to revamp the debtor’s operations by rejecting burdensome contracts and selling assets. Even the proponents of a sovereign bankruptcy system admit that these features are largely irrelevant to sovereign debtors. Of course, sovereigns come in a variety of flavors, with differing forms of “sovereign immunity.” Few sovereigns retain full old-fashioned, George III style sovereign immunity. In the event of insolvency—or, more simply an inability to pay, since solvency is a somewhat difficult concept with regard to governmental debtors—sovereign debtors have four potential tools at their disposal. First, the sovereign might hide behind its immunity, in the narrow sense. That is, the sovereign will simply refuse to be sued in court. Second, the sovereign might change the law applicable to the debt. To take a simple example, the sovereign entity might say “all past promises to repay in shiny metal are now replaced with promises to pay with pieces of paper.” That might violate certain norms—call it due process or fair play—but the sovereign probably at the same time controls the remedy for violations of such norms. Third, the sovereign might manipulate the currency in which its debts are paid. If the sovereign “makes the money,” it can make more to pay the debts. There are economic consequences to doing this to an extreme, but the sovereign might view those consequences as preferable to those of a formal default. These first three tools comprise the modern concept of sovereignty, at least in discussions of sovereign debt.