Wesley Posted October 3, 2013 Posted October 3, 2013 Read more: http://www.nytimes.com/2013/10/03/business/wall-st-fears-go-beyond-shutdown.html?_r=0 With Washington preoccupied by the government shutdown, Wall Street is shifting its attention to an even more worrisome situation: the possibility that the government could run out of money within the next few weeks, forcing an unprecedented default on its debt. Related [*] Obama Sets Conditions for Talks: Pass Funding and Raise Debt Ceiling (October 3, 2013) [*] Economix Blog: Shutdown Savings and the Debt Ceiling(October 2, 2013) The Treasury said last week that Congress had until Oct. 17 to raise the limit on how much the federal government could borrow or risk leaving the country on the precipice of default. If the debt ceiling is not raised by then, the Treasury estimates it will be left with about only $30 billion in cash, which would be used up in a matter of days. As a result, economists and investors have quietly begun to explore the options the White House might have in the event Congress fails to act. The most widely discussed strategy would be for President Obama to invoke authority under the 14th Amendment and essentially order the federal government to keep borrowing, an option that was endorsed by former President Bill Clinton during an earlier debt standoff in 2011. And in recent days, prominent Democrats like Senator Max Baucus, chairman of the Senate Finance Committee, and Representative Nancy Pelosi, the House minority leader, have urged the White House to seriously consider such a route, even if it might provoke a threat of impeachment from House Republicans and ultimately require the Supreme Court to rule on its legitimacy. Other potential October surprises range from the logistically forbidding, like prioritizing payments, issuing i.o.u.’s or selling off gold and other assets, to more fanciful ideas, like minting a trillion-dollar platinum coin. So far, administration officials have continued to insist that there is no plausible alternative to Congressional action on the debt limit.
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