The US Treasury Debt Will Be Paid
There will NOT be a default on U.S. Treasury debt. It won’t happen because it has the potential to spin out of control. Even something that is “technical” and “temporary” could have ramifications for the market that no one will be willing to risk.
U.S. Treasury default is an interesting story for the media because it is different. It is interesting for some pundits who know nothing about bonds because it is a great time to do some government bashing and pretend to know something about the bond market. Finally, it is apparently a good subject for politicians and even Treasury Secretaries because it has such a good “doom” element that it catches people’s attention and attracts some fame.
In the end, it won’t happen, and betting that it will, or even might, is not the right strategy.
Ability to Pay versus Willingness to Pay
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