The article explores how countries' debts are connected, showing that when one country defaults on its debt, it can lead to defaults in other countries. This happens because countries borrow money from the same lenders and defaulting in one country makes borrowing more expensive and defaulting easier in another. When a foreign country defaults, it can make it cheaper for the home country to default too. This can happen because of high debt and low income in the foreign country, or when both countries default because the other is defaulting. These simultaneous defaults can cause interest rates to rise across countries. The model helps explain recent economic events in Europe.