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By Staff Reporters
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Treasury Secretary Janet Yellen warned this week that the government could run out of cash to cover its expenses as early as June 1st. Congress can avert the looming economic catastrophe by authorizing more government borrowing so the US can keep paying its bills and avoid an unprecedented default on its financial obligations.
CITE: https://www.r2library.com/Resource/Title/082610254
But with the deadline just weeks away, lawmakers are locked in a game of chicken.
- Republicans in Congress say they won’t increase the debt limit without budget cuts. Last month, the GOP-controlled House passed a bill that would lift the borrowing cap and slash government spending by around $3.2 trillion over 10 years.
- But that bill is DOA in the Democrat-led Senate. Democrats insist the debt limit should be raised with no strings attached.
If the US does run out of money…look out. The Treasury would have a range of extremely bad to absolutely terrible belt-tightening options, including delaying payments to federal contractors and Social Security recipients, all to avoid falling behind on interest payments for Treasury bonds.
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Filed under: Investing, Accounting, "Ask-an-Advisor", Alerts Sign-Up | Tagged: debt, bonds, treasury bonds, Treasury Secretary, Janet Yellen, US Debt ceiling, debt ceiling, US Debt, Yellen |
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