US is about to run into a financial crisis, placing the country in a state of angst.
Exceeding the debt limit simply means that the US government would no longer be able to borrow money to pay its bills, unless Congress intervenes. The debit ceiling was raised twice under US ex-President Donald Trump been and three times in the last six months, and is now currently scoring towards $31.4tn.
The development has caused the Treasure Department into taking “drastic measures” to salvage the situation and avoid the looming tragedy. The Republicans, who recently proposed a bill to abolish the IRS, are hampering on spending reductions, while The White House's refusal to negotiate on raising or suspending the debt raises fear that US may default for first time in history.
“This is about economic stability versus economic chaos,” Deese told Kaitlan Collins on “CNN This Morning,” calling it Congress’ “basic, fundamental obligation.”
“The fallout is serious,” said Mark Zandi, chief economist at Moody’s Analytics.
“It would create chaos in financial markets and completely undermine the economy,” he added. “The economy would go into a severe recession.”
“Failure to meet the government’s obligations would cause irreparable harm to the U.S. economy, the livelihoods of all Americans, and global financial stability,” Yellen wrote in her letter to leaders of both parties in both chambers.
The situation is causing similar panic on social media.
@CloudAtlas_47 asked, “Who do the owe that much to? Aliens and Decepticons?”
@TrackInflation showed the inflation threat it posed.
On Thursday the US will hit its debt limit and be forced to raise the debt ceiling. Eventually this debt will destroy the Western World through massive hyperinflation pic.twitter.com/6EuZaSn4vu— Inflation Tracker (@TrackInflation) January 17, 2023
“Aren't we living in the strongest economy ever?” @julioca51714111 tweeted.
Wait!!! Aren't we living in the greatest economy ever? Didn't the feds said that our economy is stronger than expected and can take more rate hikes.— Alejandro Batt (@julioca51714111) January 19, 2023
Uhm!!! Makes me wonder if the people in the feds know what they are doing and what they are talking about.
@unusual_whales suggests that the US government lives “within their means”.
Any successful business must continually look for ways to drive efficiency— Colin Murray (@ColinRDMurray) January 19, 2023
Take cost out of the system
Anyone who wants to retire comfortably must live on a budget and invest
Live within your means
Our government – Democrats & Republicans – does neither
“But I was assured Janet Yellen only brought up the debt limit to distract from Biden’s documents,” @Boomieleaks said.
@WalStreet2 thinks the whole situation is being overexaggerated.
literally nothing bad has ever happened when the debt limit gets raised.— Wall(-e) Street (@WalStreet2) January 19, 2023
@PelosiTracker_ posted this “fun fact” that sparked controversy:
Fun Fact Friday♟️— Nancy Pelosi Stock Tracker ♟ (@PelosiTracker_) January 13, 2023
The U.S. will hit the debt limit on Jan 19th & will do “extraordinary measures” to pay these bills
In 2023, the US paid $500B in debt interest & are on pace to pay $1T/year by 2032
Interest on our debt would become the second largest expense in our country
“The real problem isn't hitting the debt limit, it's the lack of political will to address our out of control spending,” someone replied.
@sjs24851 posed the “obvious solution” to America's most pressing issues.
Tax US corporations sitting on trillions of dollars. Cut US military, NSA, CIA, NASA funding to balance the books. Education, Health, Housing will be readily available. Poverty in US will diminish. Is it not obvious??— Josl (@sjs24851) January 14, 2023
Finally, @AdamKinzinger warns: “Pay your credit cards.”
Defaulting on the US debt by not raising the debt limit will crush the economy and skyrocket interest rates on US debt. It will cost way more than any savings from cuts. It’s a dangerous game the GOP will own if they default. Pay your credit card.— Adam Kinzinger #fella (@AdamKinzinger) January 17, 2023
This article was produced and syndicated by Wealth of Geeks.