The flip side of this is that no international banking organization will likely do business with them for a long, long time. But considering the fact that no citizen of the country ever understood the complex nature of how they were being manipulated...this makes sense.
Is that the real history of default like this? Some countries have defaulted and some creditors do rush back in. They see a potential creditor with nothing now owed and take the risk that the country won't default again. Sure, the rates might be astronomical, but it doesn't always stop creditors from taking the chance.
I used to work in finance, one of the funny things that would happen to those that declared bankruptcy (went through the filings legally) is that it didn't take long for credit offers to come pouring back in at an astronomical rate. So long as they had a job, some companies actually have a business model around taking that risk.
Obviously declaring everyone's mortgage forgiven is stupid and this is not what is happening, but it is worth noting that default doesn't necessarily mean a lack of credit going forward. The idea that there should be no risk to creditors has been a mistake the Europeans have been making for awhile now. Of course, we know why they are doing it - because their whole house of cards is doomed if reality were allowed to set in (they are all essentially bankrupt), but it is an interesting topic for debate nonetheless.
I have to see hw this unfolds. Iceland got hosed big time in ‘08.