Just when will the threat of a U.S. debt default began to inflict damage on the U.S.economy and global financial system?
It’s already happening. And until Congress gets over its temper tantrum and lifts the Treasury’s borrowing authority, it will get progressively worse. Imagine if you woke up tomorrow morning and the U.S. government said $20 bills weren’t actually worth $20 anymore. Try using one in a New York City cab.
That’s essentially what will happen Oct.18 if Congress doesn’t agree to lift the debt ceiling and the government defaults. Only the $20 bills will be U.S. Treasury bonds, the global currency used by governments, investment funds, banks, large corporations and anyone else who deals in very large amounts of money.
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