What it would mean for the global economy if the US defaults on its debt
1 year, 7 months ago

What it would mean for the global economy if the US defaults on its debt

Associated Press  

WASHINGTON — If the debt crisis roiling Washington were eventually to send the United States crashing into recession, America’s economy would hardly sink alone. Because the dollar’s dominance has made it the de facto global currency since World War II, it’s relatively easy for the United States to borrow and finance an ever-growing pile of government debt. “Even though we were the problem — we, the United States — there was still a flight to quality,’’ said Clay Lowery, who oversees research at the Institute of International Finance, a banking trade group. GOVERNMENT’S STRATEGY IF DEBT CAP IS BREACHED In a debt-ceiling crisis, Lowery, who was an assistant Treasury secretary during the 2008 crisis, imagines that the United States would continue to make interest payments to bondholders.

Global Economy China Sri Lanka Financial States Financial Markets Debt Treasury Currency Crisis United Dollar Its Debt Other Countries Dollars Zandi Lowery Treasurys  crisis  dollars  states  treasury  currency  global  defaults  financial  dollar  debt  mean  united  economy

History of this topic

U.S. could face ‘Liz Truss moment’ without action on debt mountain
1 month ago

U.S. could face ‘Liz Truss moment’ without action on debt mountain

Live Mint  

The U.S. could face a sharp rise in borrowing costs and turmoil in financial markets as soon as next year if government debt continues to pile up rapidly, according to insurance giant Swiss Re’s group chief economist. “I don’t exclude next year that the U.S. is going to have a Liz Truss moment for Treasurys" he said, referring to the …

Inflation, debt, default: Donald Trump’s second term poses massive economic challenges
1 month, 2 weeks ago

Inflation, debt, default: Donald Trump’s second term poses massive economic challenges

Live Mint  

As Donald Trump begins his second term, several key challenges lie ahead. The growing debt burden has already affected investor confidence, sending U.S. government bond yields higher as market participants worry about the long-term sustainability of U.S. fiscal policy. Previous debt ceiling standoffs have pushed the U.S. close to default, and there is concern that the political divide in Washington …

China's growth helps bolster global economic recovery in H1
3 months, 4 weeks ago

China's growth helps bolster global economic recovery in H1

China Daily  

Photo taken on July 29, 2024 shows the US Treasury Building in Washington, D.C., the United States. MULTIPLE CHALLENGES WEIGH ON GROWTH According to the latest reports from the IMF and the World Bank, global economic growth is projected to inch forward to 3.2 percent and 2.6 percent respectively this year, with both forecasts suggesting a marginal 0.1 percentage point …

Rising US debt risk bad for its own and global economy
5 months, 2 weeks ago

Rising US debt risk bad for its own and global economy

China Daily  

A teller counts and arranges dollar notes at an Agricultural Bank of China branch in Qionghai, Hainan province. The International Monetary Fund recently warned that the excessive fiscal deficit and debt scale of the United States are posing a growing risk to its own and the global economy, urging the US to solve this long-standing problem as soon as possible. …

Why the G-20 ‘Common Framework’ for Debt Relief Isn’t Helping Poor Nations
8 months, 2 weeks ago

Why the G-20 ‘Common Framework’ for Debt Relief Isn’t Helping Poor Nations

Bloomberg  

More than half of the world’s low-income countries are at high risk of debt distress or are already in it, and several have defaulted. But despite the world’s 20 largest economies having agreed in 2020 to a plan called the Common Framework to smooth the process of restructuring loans that governments could no longer afford to service or repay, progress …

Global debt surges to record high as borrowing costs bite
10 months ago

Global debt surges to record high as borrowing costs bite

The Telegraph  

Global debt has surged to a record high of $313 trillion, as higher interest rates drive up borrowing costs for companies and governments worldwide. Jan Friederich at Fitch Ratings said higher borrowing costs mark “a quite substantial change from the environment of. Speaking at the launch of the IIF’s Global Debt Monitor he said that “average interest expenditure relative to …

US debt ceiling has catastrophic effects- 83 lakh job losses, world recession I EXPLAINED
1 year, 6 months ago

US debt ceiling has catastrophic effects- 83 lakh job losses, world recession I EXPLAINED

India TV News  

US Debt ceiling row: Amid the looming catastrophic recession, US President Joe Biden and House Speaker Kevin McCarthy are narrowing in on a two-year budget deal aiming to curb federal deficits in exchange for lifting the nation’s debt ceiling and staving off an economically devastating government default. White House estimates say a prolonged default could cause 8.3 million job losses …

‘Time’s up’: Deal on US debt ceiling close as default looms
1 year, 6 months ago

‘Time’s up’: Deal on US debt ceiling close as default looms

Al Jazeera  

A default could upend global financial markets and push the United States into a major recession. US President Joe Biden and top congressional Republican Kevin McCarthy are closing in on a deal that would raise the government’s $31.4 trillion debt ceiling for two years while capping spending on most programmes, news reports say. The potential agreement would increase funding for …

US on the debt ledge, will it fall?
1 year, 7 months ago

US on the debt ledge, will it fall?

Firstpost  

June 1, the earliest date by which the US could default is just a little over a week away. Meanwhile, “extraordinary measures” have been adopted by the US Treasury Department to maintain cash flow till the “hard deadline”, but without an agreement in Congress to raise the limit Treasury Secretary Janet Yellen has warned that the US may not meet …

What happens if US fails to resolve its debt ceiling crisis? All possibilities listed
1 year, 7 months ago

What happens if US fails to resolve its debt ceiling crisis? All possibilities listed

Hindustan Times  

In a crucial development amid the looming US debt crisis, President Joe Biden is set to meet with House Speaker Kevin McCarthy on Monday to negotiate a resolution. US President Joe Biden will meet with Republican House Speaker Kevin McCarthy on Monday for another round of talks on raising the US debt ceiling less than two weeks before a key …

What it would mean for the global economy if the U.S. defaults on its debt
1 year, 7 months ago

What it would mean for the global economy if the U.S. defaults on its debt

LA Times  

People take in the twilight view in the business district of Beijing. If the debt crisis roiling Washington were eventually to send the United States crashing into recession, America’s economy would hardly sink alone. “A debt default would be a cataclysmic event, with an unpredictable but probably dramatic fallout on U.S. and global financial markets,’’ said Eswar Prasad, professor of …

'America will not default,' says Biden amid debt-ceiling crisis; likely to hold trilateral meet in Japan during G7
1 year, 7 months ago

'America will not default,' says Biden amid debt-ceiling crisis; likely to hold trilateral meet in Japan during G7

India Today  

President Joe Biden on Wednesday asserted his confidence in overcoming the ongoing debt ceiling crisis in the US, and said he is sure the country will avoid an unprecedented and potentially catastrophic debt default, saying talks with congressional Republicans have been productive. “I’m confident that we’ll get the agreement on the budget and America will not default,” Biden said from …

What to expect as the US continues with debt ceiling negotiations
1 year, 7 months ago

What to expect as the US continues with debt ceiling negotiations

Al Jazeera  

Republican lawmakers continue to insist on cuts to social programmes as US debt default looms on the horizon. “Every single day that Congress does not act, we are experiencing increased economic costs that could slow down the US economy,” Treasury Secretary Janet Yellen said on Tuesday. But officials confirmed on Tuesday that he would return over the weekend, nixing previous …

This time, the debt ceiling crisis really could end in disaster
1 year, 7 months ago

This time, the debt ceiling crisis really could end in disaster

LA Times  

The last time the U.S. government went to the brink of defaulting on its debt — in 2011 — the stock market tumbled and there was something close to a panic across the economy before Washington came to its senses and cut a deal. And it doesn’t have to come to a full-fledged default for the government and millions of …

Debt limit fight: Trump tells GOP 'do a default' if needed, but talks with Biden in full swing
1 year, 7 months ago

Debt limit fight: Trump tells GOP 'do a default' if needed, but talks with Biden in full swing

The Independent  

Sign up for the daily Inside Washington email for exclusive US coverage and analysis sent to your inbox Get our free Inside Washington email Get our free Inside Washington email SIGN UP I would like to be emailed about offers, events and updates from The Independent. “I say to the Republicans out there — congressmen, senators — if they don’t …

US default on $31.46 trillion debt may lead to global crisis: Treasury chief
1 year, 7 months ago

US default on $31.46 trillion debt may lead to global crisis: Treasury chief

Hindustan Times  

U.S. Treasury Secretary Janet Yellen on Thursday urged Congress to raise the $31.4 trillion federal debt limit and avert an unprecedented default that would trigger a global economic downturn and risk undermining U.S. global economic leadership. "It would also risk undermining U.S. global economic leadership and raise questions about our ability to defend our national security interests." Yellen said she …

Why US debt default could cause catastrophic damage to the dollar and its reputation
1 year, 7 months ago

Why US debt default could cause catastrophic damage to the dollar and its reputation

Firstpost  

In August 2021, the mere prospect of a potential default led to an unprecedented downgrade of the nation’s credit rating, hurting America’s financial prestige as well as countless individuals, including retirees. If Republicans push the US into default, the dollar would likely lose its position as the international unit of account, forcing the government and companies to pay their international …

What happens if the US defaults on its debt?
1 year, 7 months ago

What happens if the US defaults on its debt?

Al Jazeera  

As a game of chicken plays out in Washington, DC, over whether to raise the limit on US government borrowing to avoid a default on its debt, the one thing that experts agree on is that a default would be catastrophic. As these cuts worked their way through the economy, “the hit to growth would be overwhelming,” Yaros and several …

US debt-ceiling: Biden, McCarthy aim to break standoff as default crisis looms
1 year, 7 months ago

US debt-ceiling: Biden, McCarthy aim to break standoff as default crisis looms

Live Mint  

President Joe Biden and top Republicans and Democrats from Congress are set to sit down this week to try to resolve a three-month standoff over the $31.4 trillion US debt ceiling and avoid a crippling default before the end of May. Biden is due to meet on Tuesday at the White House with McCarthy for the first time since Feb. …

White House warns of recession as debt limit fight drags on
1 year, 7 months ago

White House warns of recession as debt limit fight drags on

India Today  

White House economists on Wednesday warned of “severe damage” to the US economy in the event of a debt default, warning that a prolonged default could cause 8.3 million job losses and the stock market to tumble 45%. The White House analysis warned that a protracted default could cost more than 8 million jobs in the third quarter of 2023, …

White House warns of recession as debt limit fight drags on
1 year, 7 months ago

White House warns of recession as debt limit fight drags on

Associated Press  

WASHINGTON — White House economists on Wednesday warned of “severe damage” to the U.S. economy in the event of a debt default, warning that a prolonged default could cause 8.3 million job losses and the stock market to tumble 45%. The White House analysis warned that a protracted default could cost more than 8 million jobs in the third quarter …

House Republicans pass U.S. debt bill, push Biden on spending
1 year, 7 months ago

House Republicans pass U.S. debt bill, push Biden on spending

LA Times  

Speaker of the House Kevin McCarthy arrives for a closed-door meeting with fellow Republicans as he pushes his debt ceiling package on Wednesday. House Republicans narrowly passed sweeping legislation Wednesday that would raise the government’s legal debt ceiling by $1.5 trillion in exchange for steep spending restrictions, a tactical victory for Speaker Kevin McCarthy as he challenges President Biden to …

US default on debt will trigger an ‘economic catastrophe’: Yellen
1 year, 7 months ago

US default on debt will trigger an ‘economic catastrophe’: Yellen

Al Jazeera  

Janet Yellen warned that a default would result in job losses while driving household payments on higher interest rates. US Treasury Secretary Janet Yellen on Tuesday warned that failure by Congress to raise the government’s debt ceiling – and the resulting default – would trigger an “economic catastrophe” that would send interest rates higher for years to come. Yellen, in …

New estimate U.S. could face default on debt by early June
1 year, 10 months ago

New estimate U.S. could face default on debt by early June

Associated Press  

WASHINGTON — The U.S. could face an unprecedented default on its obligations as soon as early June if Congress does not act to lift the debt limit, a Washington think tank said Wednesday. Previewing the data for reporters on a morning call, Shai Akabas, the center’s director of economic policy, said the new projections reflect “considerable uncertainty in our nation’s …

Views of U.S. economy improve but remain low; debt ceiling uncertainty looms — CBS News poll
1 year, 10 months ago

Views of U.S. economy improve but remain low; debt ceiling uncertainty looms — CBS News poll

CBS News  

Views of the nation's economy have ticked back up — though they remain a long way from good. In another sign of uncertainty as debt ceiling talks continue, Americans' views on the debt limit are tied to how likely they think an economic downturn is if it isn't raised. The debt ceiling Views on raising the debt ceiling start off …

Lots of sound and fury on US debt, but not a crisis — yet
1 year, 10 months ago

Lots of sound and fury on US debt, but not a crisis — yet

Associated Press  

WASHINGTON — For all the sound and fury about raising the nation’s debt limit, most economists say federal borrowing is not at a crisis point. The political jousting masks contrasting realities: Today’s $31.4 trillion national debt does not appear to be a weight on the U.S. economy, but the debt’s path in the decades to come might put at risk …

Amid fears of a crisis, the US begins the debt ceiling battle
1 year, 11 months ago

Amid fears of a crisis, the US begins the debt ceiling battle

Hindustan Times  

With the United States hitting its debt ceiling limit on Thursday, America has entered a period of a gruelling political battle over a debate on the issue, with the White House warning that Republican obstructionism risks push the country towards an economic “catastrophe” and Republicans placing the responsibility of an agreement on Democrats. As the US Government Accountability Office, the …

Will Republicans blow up the global economy? Here is what to watch for
1 year, 11 months ago

Will Republicans blow up the global economy? Here is what to watch for

Raw Story  

We barely had time to catch our breath from the wild spectacle of the Republicans finally electing a speaker when their next spectacle started with a bang. Take, for example, Rep. Marjorie Taylor Greene of Georgia, just named to the House Oversight and Homeland Security committees, who said this on Steve Bannon's podcast shortly after the November election: What we …

US starts fiscal year with record $31 trillion in debt
2 years, 2 months ago

US starts fiscal year with record $31 trillion in debt

Associated Press  

WASHINGTON — The nation’s gross national debt has surpassed $31 trillion, according to a U.S. Treasury report released Tuesday that logs America’s daily finances. Edging closer to the statutory ceiling of roughly $31.4 trillion — an artificial cap Congress placed on the U.S. government’s ability to borrow — the debt numbers hit an already tenuous economy facing high inflation, rising …

China's Great Wall of Debt: can it afford a default?
3 years, 2 months ago

China's Great Wall of Debt: can it afford a default?

ABC  

Lai Xiaomin's once-glittering career ended not with the popping of champagne corks and glowing testimonials, but at the hands of an executioner. Once known as the God of Wealth, Lai oversaw one of China's biggest and most important state-owned enterprises, Huarong Asset Management. Having just blinked on Huarong, global markets last week began betting Beijing once again would ride to …

Discover Related