How's It Going To Play Out?
Posted in the Weird Forum
“"*" Always Thinking "*"”
Since: Nov 12
#1 Oct 14, 2013
Here's When The US Government Will Really Run Out Of Cash
Steven Perlberg Oct. 12, 2013, 7:26 AM 3,900 6
Treasury Secretary Jack Lew has warned us that the U.S. would hit the debt ceiling on October 17 — the date at which Treasury will cease to issue debt.
However, many confuse this with the day the U.S. runs out of cash and the government defaults.
Here is Goldman Sachs' Alec Phillips explained earlier this month:
Since the Treasury usually aims to run a cash balance large enough to cover unexpected payment needs or a revenue shortfall, the Treasury expects to have $30bn on hand the day it exhausts its borrowing capacity. The Treasury views this $30bn as the minimum prudent balance in light of the significant uncertainty in daily cash flows, though there have been a few instances (unrelated to the debt limit) in which the cash balance has dipped below $15bn. Most external projections of the debt limit deadline focus on when this cash is depleted. Our own estimate implies that the Treasury could conceivably continue to make its scheduled payments until the end of October. However, the Treasury’s cash balance is likely to be so low after about October 25 that, depending on revenue fluctuations, the cash balance could be depleted on any day. At that point, it is possible that the Treasury would need to cease making payments in order to conserve the little remaining cash they would still have on hand.
This isn't to say markets wouldn't react on October 17, but it does mean the politicians have a few days of extra wiggle room to strike a seemingly inevitable deal.
Read more: http://www.businessinsider.com/when-the-us-go...
=*= This is what I see it coming to =*=
"WE" will not default -unless-'outside' forces come in to play(???)
The United States of America is not holding the trump card.
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