Saturday, July 23, 2011

Debt Ceiling Deadline Might Be August 10, Not August 2

Obama said that March 16, 2011, was the date we must raise the debt ceiling or America would default its loans. Then, Obama said that August 2, 2011, was the date we must raise the debt ceiling or the elderly will not receive their social security check. Now, Obama is saying August 10, 2011, will be the date that America will default its loan if the debt ceiling is not raised. America's reaction- YAWN!

HuffPo — For months, markets have been girding themselves against the possibility that the U.S. will reach the limits of its borrowing ability on August 2 and default on its debts. But researchers at Barclays Capital think the real deadline may not be until a week later.

In a note published Friday, the Barclays Interest Rates Research team
wrote that “the date on which the Treasury will run out of cash to pay its obligations might not be August 2; it might be around August 10 instead.”

Why the change? The note explains that previous projections showed the Treasury running out of money on the morning of Wednesday, August 3. On that day, it was predicted, the Treasury would need to spend $32 billion, including $22 billion in Social Security payments — and it was only projected to have $30 billion at its disposal.

That projection was made on July 13. But since then, the researchers say, the Treasury has taken in about $14 billion more than expected, and paid out about $1billion less than expected. Hence, the deadline date might actually be August 10, a week later than previously believed.

The August 2 deadline has never been set in stone. When Treasury Secretary Timothy Geithner announced in May that the federal debt limit had been reached, he said that the government could use “extraordinary measures” to extend borrowing authority until August 2 — and that this date could change “based on government receipts and other factors.”