On May 10, US President Biden delivered a speech on the Republican debt limit the bill, saying that the Republican Party should unconditionally avoid debt defaults.If the US debt defaults, "the world will be in trouble."The day ago, Biden held talks with the two -party leader of Congress on the issue of federal government debt, and eventually failed to reach an agreement.
The upper limit of debt is the highest amount of debt settled for the Federal Government to fulfill the payment obligations that have been performed. It touches this "red line", which means that the Ministry of Finance's loan authorization is used.
At present, US debt has accumulated $ 31 trillion.In January of this year, US Treasury Minister Yellen Trusted Congress: The scale of the US federal government debt reached a statutory limit of US $ 3.1.4 trillion approved by Congress in September 2021. The US Ministry of Finance immediately took unconventional measures to avoid government debt breach.However, the US Treasury may not be able to pay all government bills as early as June 1.
It can be seen that the "2023 restrictions, savings, and growth bills" adopted by the House of Representatives of the United States Congress on April 26 proposed a $ 1.5 trillion debt limit plan to increase US Treasury bonds to a maximum of US $ 32.9 trillion.But the premise is that the Biden government must control the expenditure to $ 4.5 trillion.McCarthy has repeatedly stated that if Biden does not control government expenditure, it is necessary to prevent raising the upper limit of government loans.
The problem is that the areas led by the Republican Party demanded that government expenses include medical care, science, education, climate, energy, etc., which happens to be exempted from student loan debt plans, medical subsidies, tax reduction and climate changes with the Bayeng government.Policies and other conflicts, because the Bayeng government must increase government expenditure to achieve its goals.The latest monthly budget data released by the US Treasury Department shows that due to the increase in expenditure in education, medical insurance welfare and debt interest, the FBI in the first half of the fiscal year 2023 (October 1, 2022 to March 31, 2023)The deficit is as high as 1.1 trillion US dollars, a significant increase of 63%over the same period last year.
There is not much time left to the Biden government, because it is less than 1 month to seek the final period of the debt limit to increase the upper limit of debt in early June.If Bayeng and Congress will not be able to reach an agreement on the upper limit of US debt, which will lead to debt defaults, it will bring a series of chain reactions and a huge impact on the United States and the global economy.Earlier predictions said that the US economy will fall into recession in the second half of 2023. Most experts believe that debt defaults will likely make the economic recession faster.Yellen bluntly recently that if the upper limit of debt in the US debt has caused debt defaults, it will have a "disaster" on the United States and the global economy.Some economists have said that because the US dollar occupies a dominant position in the international monetary system, if a debt defaults in the United States, a systematic economic crisis will occur, especially affecting the stability of the global financial market. Some banks, financial institutions, small and medium -sized enterprises willAnd multinational companies will be affected.
The upper limit of debt was the last barrier to ensure the healthy development of the United States.But the breakthrough limit in the United States has become a commonplace.According to data from the US Treasury, since 1960, the United States has suspended or raised its debt limit 80 times, most of which have been raised.Biden revealed that he would talk to McCarthy again on May 12, and it seemed to show a certain degree of compromise.
But even if it has reached a consensus on raising the upper limit of debt, it is difficult to speak.On the one hand, the subsequent impact of the US debt storm deserves high attention. Global funds will change in the direction of investment. To a certain extent, the willingness to purchase US debt to purchase US debt to a certain extent will indirectly promote the price of high commodities, precious metals and oil.It will undoubtedly promote global inflation for a long time.On the other hand, in the case of the Fed's insisting on raising interest rates to respond to inflation, the US banking industry will continue to "lose blood", and the risk of the banking industry is far from disappearing.In fact, after the outbreak of the US banking crisis, the US credit demand in the first quarter encountered a rare plunge, the lowest level since 2009, which may mean that the United States is accelerating the decline.
