Credit Default Swaps could be purchased on the relevant sovereign debt.
Given the success that various hedge funds had with this strategy during the crash of mortgage backed CDOs a couple of years back I would have thought that there must be a lot of speculation of this kind going on.
Assuming that there are still sellers of CDSs out there...
And remember: timing is everything. Japan has been obviously fked for a long, long time now, but hasn't paid much of a price for it in the bond market. Now that they are going to have to finance their debt externally, maybe reality will assert itself.
Given the success that various hedge funds had with this strategy during the crash of mortgage backed CDOs a couple of years back I would have thought that there must be a lot of speculation of this kind going on.
Assuming that there are still sellers of CDSs out there...