Why October 19 could be a catastrophic day for the US economy

By Matt Egan, CNN Business

Updated 6:34 AM ET, Fri October 1, 2021

New York (CNN Business)The United States could be just weeks away from defaulting on its debt for the first time ever.

The $28.4 trillion debt limit was reinstated August 1. Since then, Treasury Secretary Janet Yellen has been keeping the nation’s finances afloat by using emergency accounting maneuvers. Known as “extraordinary measures,” these steps allow the government to borrow additional funds without breaching the debt ceiling.

But Yellen warned lawmakers this week that if Congress fails to raise, or suspend, the debt ceiling, the federal government will exhaust those extraordinary measures by October 18.

“At that point, we expect Treasury would be left with very limited resources that would be depleted quickly,” Yellen wrote in a letter to Congress. “It is uncertain whether we would continue to meet all the nation’s commitments after that date.”

Continued

Carl Sagan

Article URL : https://www.cnn.com/2021/10/01/economy/debt-ceiling-next-steps/index.html