12 Marcheshvan 5774
The American government is bankrupt. It owes more money than it can ever hope to pay back. It's been "kicking the can down the road" by raising the debt limit and printing more dollars, but world economists agree that even this must come to an end sometime. Has the "can" finally reached the end of the road???
Debt clock ticking, but default damage already unfolding
The warnings from Wall Street are dire: A stomach-turning dive in the stock market. World economies in peril. Another recession in the United States. A replay of the 2008 financial crisis — or worse.
And the date investors are worried about is fast approaching. It’s Thursday, when the United States bumps up against the $16.7 trillion limit set by Congress for the amount of money the government can borrow.
...t may not happen exactly at the open of business Friday morning. The government might scrape by until next week sometime. But if it’s forced into default by Congress, the damage would spread within days. And would take years to clean up.
As US Default Nears, Investors Shrug Off Threat
Warren Buffett likens it to a nuclear attack. Economists warn that government spending on programs like Social Security would plunge. The Treasury says the economy would slide into a recession worse than the last.
Yet you wouldn’t know that a U.S. debt default could amount to a nightmare from the way many companies and investors are preparing for it: They aren’t. The assumption seems to be that in the end, Washington will find a way to avert a default.
“Doomsday is nigh, and everyone shrugs,” said Nicholas Colas, chief market strategist at ConvergEx Group, an investment brokerage in New York.