A US Default Would Lead To Clearinghouse Collapse And Shockwave Of Catastrophic Treasury Margin Calls
With three weeks left until Janet Yellen's earliest estimate for when the infamous X-date will hit on June 1 (the date which effectively marks a technical default by the US, only it doesn't because while the government can prioritize debt payments it wouldn't make all payments to America's bloated bureaucracy represented by some 22.6 million parasites not to mention countless deep state agents), the fearmongering has hit record highs.
Yesterday, in a letter to Janet Yellen (who was quick to pass on the doom and gloom to corporate CEOs), the Treasury Borrowing Advisory Committee said the costs of the current standoff extend beyond markets to the time that financial firms are having to spend preparing for a possible default.
“The short-term impacts of a protracted negotiation are costly; the long-term implications of a default are unthinkable,” wrote the 17-member group, which includes Goldman Sachs executives Beth Hammack and Ashok Varadhan and former JPMorgan Chief Operating Officer Matt Zames. “The magnitude of adverse consequences from a prolonged negotiation, or a default, is unquantifiable.”