John Smith’s map of Virginia, engraved by William Hole and published in 1612. Public domain.
In August 1982 Mexico told its lenders it could not pay, and a decade of debt workouts began.
If money is tight, a foreign default matters when your bank gets scared and your credit gets tighter.
If you are in the middle, a crisis with a foreign name can still raise the rate on a domestic loan.
If you have savings, you may own the banks that owned the loans.
Mexico's finance officials told the Federal Reserve and the Treasury that the country could not meet its payments.
American banks were heavily lent into Latin America.
The debt crisis that followed was a banking crisis wearing a foreign flag.
Source: Federal Reserve history of the August 1982 Mexican debt crisis.