LIVE: Argentina Could Be Minutes Away From Default

UPDATE: Argentine Economy Minister Axel Kicillof will give a press conference in New York City at 5:15 EST.

If Argentina does not come to an agreement about how it will pay over $1.3 billion worth of sovereign debt due to a group of hedge fund credits by 5:00 pm EST tonight, it will go into default.

Indeed, Standard & Poors has already cut the country's rating to "selective default" - meaning the country has chosen to renege on some of its payments, but not all of them.

"We are... lowering our long- and short-term foreign currency sovereign credit ratings on Argentina to selective default ('SD') from 'CCC-/C'," said the agency's release, "indicating that Argentina defaulted on some of its foreign currency obligations. At the same time, we are removing the 'CCC-/C' foreign currency ratings from CreditWatch, where they were placed with negative implications on July 1, 2014."

Of course, if Argentina comes to an agreement with NML this nasty rating would go away, says S&P.

This is the culmination of a decade-long legal battle, in which The Republic refused to pay some investors that bought its sovereign debt after its last default in 2001. The investors, known collectively as NML Capital and led by hedge fund billionaire Paul Singer, would not take haircuts on that debt like over 90% of their fellow bond holders.

To Argentina that made them vultures, and you don't pay vultures.

The country took that intransigence went all the way to The Supreme Court. When it lost there, it argued that it could not pay NML without triggering a clause in its bond prospectus called the RUFO clause - the Rights Upon Future Offers clause.

Basically it says if Argentina negotiates better terms with some bondholders, all bondholders have a claim on those terms. That would open the country to up to $15 billion worth of payments. Earlier this month, the Court didn't buy that, and refused Argentina's request for a stay on payment until negotiations could be worked out (ideally with a payment to NML due in 2015).

That $15 billion is chump change compared to what the country might have to pay if it goes into default, though. Default opens the country up to "acceleration clause" claims - in which bondholders argue that they want all their money at once and now - worth $29 billion. That's everything in Argentina's Central Bank.

Hold on... this could get ugly.