Who Collapses First?

The financial crisis du jour in the United States is California declaring a "fiscal emergency", but over on the other side of the pond we have this from Reuters: Sterling Crisis Looms as U.K. Unraveling Points to Budget Cuts

The state of the U.K. economy fills British financial historian Niall Ferguson with foreboding.

“The probability of a real sterling crisis is around one in three, and the probability of major tax hikes and cuts in public spending is roughly one in one,” the Harvard University professor says.

Ferguson’s concern stems from the deterioration in the U.K.’s public finances, which prompted Standard & Poor’s to warn on May 21 that the country could lose its AAA debt rating.

So, whose debt will default first?