Some Investors Speculate on US Default Later This Month

A few financial institutions are doing just that — betting the government will default on its debt if Congress can’t agree to raise the debt ceiling this month.

If the U.S does default, they could reap a total payout of around $3.4 billion.
Sound like a lot? Actually, investors seem less convinced that a default will occur this time around than they were during the last big debt ceiling scare in the summer of 2011. Back then, they held contracts that would have paid out about $5.6 billion in the event of a default, according to the Depository Trust and Clearing Corporation.

via CNN

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza