Scrip in lieu of bonds or cash, this time courtesy of Ed Kleinbard in the NYT.
The key market question here is whether the scrip would generally be accepted as cash-equivalent, and my guess is that it would.
I agree with the Administration's unwillingness to say in advance that it will actually do any of these things to avoid disaster, since that would reduce the pressure on the blackmailers to act honorably and responsibly. But when the crunch comes, it would be horribly negligent to permit disaster.
The judgment of which escape route to use, among the various alternatives, is quite a tricky one. It involves not just straight-up legal analysis, but also prediction of what politically motivated courts might do, along with forecasting how the markets would react and war-gaming the political playout. Better to have many options than one or none, however, at least if they can make a good call.