By: Katherine Brown, Research Associate, Castle Rock Investment Company

“Best is the enemy of better,” Dad reminded me patiently, as I visited the sixth used car in two days.

It sure is: my carless condition went on for about three weeks. All the while, I toiled over used car data while bumming rides off of my friends and attempting to find the perfect car within the perfect budget. Unfortunately, a used car in perfect condition does not exist for under $10,000 – at least by the time I needed to commute to my new job at Castle Rock Investment Company.

My experience reminded me of Argentina, which cannot get out of its debt negotiations within a reasonable amount of time. The country is at risk of further serious consequences to its national well-being, and further strained relationships with significant financial partners. The comparison between one young woman’s attempt to purchase a car and a nation’s attempt to alleviate $100 billion worth of legacy debt defaults is clumsy, at best, but hasn’t Argentina stalled for years to repay the now twice-adjusted default?

A sovereign debt crisis looms if this issue is not resolved. Amid recession, dwindling supplies of foreign reserves and the highest inflation rate in the world, Argentina chokes and puffs toward the goal: one more timeout. At the moment, coupon payments to bondholders are due July 30. The total first payment due amounts to $907 million. And where is that going to come from?

The US is central to the Argentine sovereign debt crisis and even appears to be more involved than the Argentine government itself. The minister of economy and public finance, Axel Kicillof, is not attending the latest meetings to restructure Argentina’s debt to Aurelius Capital Management LP and Elliot Management Corporation. Argentina may default for the second time in 13 years on its debt, previously amid $100 billion in debt in 2001. US Judge Greisa’s 2012 ruling bans Argentina from using the US financial system should it fail to meet its deadline. Perhaps further communication would be useful to avoid this significant economic threat?

Perhaps, after 2.5 years of further appeals, Argentina should realize that delaying negotiations is not likely to significantly improve the country’s chance of a better economic situation. The shadow of doubt is lengthening at the twilight of Argentina’s latest extension.

While many sympathize with the Argentine government’s unfavorable position, further delays are improbable – especially with poor communication between the debtors and indebted. In order to identify a desirable outcome, Argentina should attend the mediating process to find the “better” at the table rather than continuously press for the “best” with a megaphone outside.

NB: My dream car is, alas, still at large; however, I do possess my own set of wheels to get from point A to point B without the trials of the carless masses. Thank you, Dad, for your help in finding a good deal!

Katherine Brown completed a Master’s degree in Global Finance, Trade, and Economic Integration from the University of Denver. Her research and writing focus on international monetary economics and central banking. She can be reached at Katherine@castlerockinvesting.com.