by Bill McBride on 10/07/2013 08:50:00 PM
Monday, October 07, 2013
There are now deniers who claim there will not be serious economic damage if the country doesn't pay the bills (aka raise the "debt ceiling"). That is crazy talk. It would probably take a few weeks before the economy completely tanked - but it would tank.
Interesting - it seems the "debt ceiling" deniers (like Larry Kudlow) are many of the same people who said there was no housing bubble! Note: I still believe - no matter how crazy Congressmen talk - that Congress will pay the bills (raise the debt ceiling).
From the WSJ: Debt Limit Taking Center Stage in Impasse
Senate Democrats this week are planning a vote to extend the nation's borrowing authority through 2014, the latest sign that the focus of the budget impasse is shifting toward preventing a U.S. debt default.From the WaPo: Obama, Senate Dems hope to break logjam soon with debt ceiling bill
President Obama and Senate Democrats tried Monday to break a political logjam that could threaten the U.S. economy, advancing legislation that would raise the federal debt ceiling as soon as possible.Unfortunately voters will forget the shutdown of the government.
Democrats said they will attempt to force Republicans to agree to a $1 trillion debt-limit increase to ensure that the government does not reach a point this month where it may be unable to pay its bills, risking its first default. They said they also may accept a short-term bill, perhaps lasting only weeks, to avoid going over the brink.
The Democratic push on the debt limit came as a partial government shutdown entered its second week with no solution in sight. New polling showed that the fiscal standoff is hurting Republicans far more than it is Obama, although no party is faring particularly well.
• 7:30 AM ET, the NFIB Small Business Optimism Index for September.
• DELAYED: At 8:30 AM, the Trade Balance report for August from the Census Bureau. The consensus is for the U.S. trade deficit to increase to $40.0 billion in August from $39.1 billion in July.
• DELAYED 10:00 AM, the Job Openings and Labor Turnover Survey for August from the BLS.