CONTRACTING FOR COLLATERAL: SOLVING THE SOVEREIGN BOND ENFORCEABILITY PROBLEM.

This Note emphasizes the importance of sovereign bonds to emergingmarket countries and proposes a solution to the enforcement problem that exists in the current market. This Note argues that sovereign nations issuing bonds should bargain for improved contracts and limit assets used as collateral for those bonds. This proposal would stabilize volatility in emerging market countries, while providing investors with stronger rights to collateral. Ultimately, this Note argues that contracts for collateral are enforceable and can become a valuable source of capital flow into the countries that need foreign investment the most. [ABSTRACT FROM AUTHOR]