The day after tomorrow represents the beginning of Washington’s debt-crisis end game, not the end of it.
The Treasury Department expects to exhaust its borrowing authority no later than Oct. 17, leaving the federal government with no more than $30 billion on hand. Depending upon daily tax receipts and incoming bills, the U.S. government could be forced to default on its obligations at any date thereafter — to bond holders and millions of Social Security recipients.
President Barack Obama said yesterday the U.S. now faces “a good chance of defaulting,” a development that would have a “devastating effect” on the economy. Though that would roil financial markets and risk triggering a global recession, the full effect will take time to unfold. Oct. 18’s dawn may seem little changed from that of the day before.
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