As Quartz explains, Argentina has spent most of the last decade restructuring its debt, following a 2001 default, but a small group of investors, led by New York-based hedge funds are demanding full repayment of that debt. The creditors won a judgement requiring Argentina to pay them $1.5 billion, but the Argentina's Economy Minister, Axel Kicillof, says paying that debt "would trigger bond clauses requiring the country to offer similar terms to other bondholders." However, a U.S. judge ruled that they can't not make a required $539 payment to those other bondholders, unless they also payout the money owed to the hedge funds. So nobody got paid anything, and South America's third-largest economy is now in (probably) in default.
The situation could be temporary, as they could still negotiate a settlement over the $1.5 billion payment. However, Kicillof has been unable to work out a deal through a court appointed mediator. Negotiations will continue over the next several days, though Argentina's president Cristina Kirchner has made it a political point of pride to not pay the "vulture funds" what the courts say they are owed.
 
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I think it is important to note that this could be temporary if they negotiate a settlement.
 
However, it might also be as likely that they don't. It's hard to say.
 
However, if the default stands it makes sense how this situation with $230 billion in default would mess up Stock markets because of the unknown consequences if this isn't resolved somehow.
 
In other words the world doesn't want another Lehman brothers kind of incident that might ripple in waves all around the world triggering many unknown consequences, especially in the times we now live in worldwide.