ALERT: US could start defaulting on debt ‘very soon’ warns US Treasury Secretary Jacob Lew

USA Washington DC The Capitol Dome Statue of Freedom and American FlagUS Treasury Secretary Jacob Lew warned Monday that the US is on course to hit its so-called debt ceiling, the limit to which it can legally borrow, by the end of the month. He called on Congress to raise it immediately to prevent the issue from harming the economic recovery, adding that the government would start defaulting on its debt “very soon” if it failed to act. “Time is short. Congress needs to act to extend the nation’s borrowing authority, and it needs to act now,” Mr Lew said in a speech on Monday. “It would be a mistake to wait until the 11th hour to get this done,” he added. Mr Lew has previously called on Congress to raise the debt ceiling swiftly in a letter last month. “In just a matter of days, the temporary suspension of the debt limit will end, and the Treasury Department will have to start using extraordinary measures so the government can continue to meet its obligations,” he said at Washington think tank the Bipartisan Policy Center.  In October, Congress and the Obama administration suspended a $16.7 trillion cap on borrowing until February 7. If the debt ceiling isn’t raised by then, Treasury will be able to juggle money between government accounts for a few weeks to keep just under the new limit. However Mr Lew cautioned that the government will burn through its leftover cash more quickly than normal because the Treasury will be issuing tax refunds. “Now, unlike other recent periods when we have had to use extraordinary measures to continue financing the government, this time these measures will give us only a brief span of time.” “Without borrowing authority, at some point very soon, it would not be possible to meet all of the obligations of the federal government,” he said. US debt currently stands at about $17.3 trillion. The Telegraph


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2 Responses to ALERT: US could start defaulting on debt ‘very soon’ warns US Treasury Secretary Jacob Lew

  1. Pingback: 666 ALERT FDA – approves ingestible pill camera /Mass sea star deaths off US west coast puzzle scientists/Organic food shortage hits U.S. stores/Indonesia 19 More Volcanos Put On Alert Level!!Muslim Brotherhood’s guide has been sent to a crimi

  2. JimB says:

    just stop borrowing and start cutting back and start paying it back

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