berita hari ini : Wall St. Fears Go Beyond Shutdown - New York Times Jason Reed/Reuters Chief executives headed to the White House on Wednesday for a meeting with President Obama. With Washington preoccupied by the government shutdown, Wall Street is shifting its attention to an even more worrisome situation: the possibility that the government could run out of money within the next few weeks, forcing an unprecedented default on its debt. The Treasury said last week that Congress had until Oct. 17 to raise the limit on how much the federal government could borrow or risk leaving the country on the precipice of default. If the debt ceiling is not raised by then, the Treasury estimates it will be left with about only $30 billion in cash, which would be used up in a matter of days. As a result, economists and investors have quietly begun to explore the options the White House might have in the event Congress fails to act. The most widely discussed strategy would be for President Obama to invoke authority under the 14th Amendment and essentially order the federal government to keep borrowing, an option that was endorsed by former President Bill Clinton during an earlier debt standoff in 2011. And in recent days, prominent Democrats like Senator Max Baucus, chairman of the Senate Finance Committee, and Representative Nancy Pelosi, the House minority leader, have urged the White House to seriously consider such a route, even if it might provoke a threat of impeachment from House Republicans and ultimately require the Supreme Court to rule on its legitimacy. Other potential October surprises range from the logistically forbidding, like prioritizing payments, issuing i.o.u.’s or selling off gold and other assets, to more fanciful ideas, like minting a trillion-dollar platinum coin. So far, administration officials have continued to insist that there is no plausible alternative to Congressional action on the debt limit. In December 2012, Jay Carney, the White House spokesman, flatly renounced the 14th Amendment option, saying: “I can say that this administration does not believe that the 14th Amendment gives the president the power to ignore the debt ceiling — period.” And on Wednesday, a senior administration lawyer said that remained the administration’s view. Still, some observers outside government in Washington and on Wall Street, citing a game theorylike approach, suggest that the president’s position is more tactical than fundamental, since raising the possibility of a way out for the White House like the constitutional gambit would take the heat off Republicans in Congress to act on its own before the Oct. 17 deadline. “If a default is imminent, the option of raising the debt limit by executive fiat has to be on the table,” said Greg Valliere, chief political strategist at Potomac Research. “Desperate times require desperate measures.” Some professional investors echoed his view, which is a reason Wall Street remains hopeful that the economic and financial disaster a government default could usher in will be avoided. “At the end of the day if there is no action and the United States has a default looming, I think President Obama can issue an executive order authorizing the Treasury secretary to make payments,” said David Kotok, chief investment officer of Cumberland Advisors in Sarasota, Fla., which has just over $2 billion under management. “There’s always been more flexibility in the hands of Treasury than they’ve acknowledged.” According to some legal theorists, the president could essentially ignore the debt limit imposed by Congress, because the 14th Amendment states that the “validity of the public debt of the United States, authorized by law,” including for debts like pensions and bounties to suppress insurrections, “shall not be questioned.” Absent Congressional approval for raising the debt limit, the constitutional route or some creative financing plan, the only alternative to default would be to cut spending by as much as a third, financing debt payments and other government obligations out of money coming in from tax receipts and other sources. If continued for more than a few days, that would deliver a shock to the economy that would almost certainly send the nation, and perhaps the global economy, back into a severe recession. klik baca selanjutnya : bit.ly/GAovhM
Posted on: Thu, 03 Oct 2013 06:50:47 +0000
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