“It is our belief that this week’s potential resolution on the debt ceiling simply moves the problem from October to December,” Michael Pugliese, an economist at Wells Fargo Securities, said in an analysis Thursday. ”Congress may find itself in early December in the same place it was in late September: facing a possible government shutdown and looming debt ceiling deadline.” The debt ceiling was reached on Aug 1., and since then the Treasury Department has used financial maneuvers to avoid defaulting on the government’s obligations while warning that it would run out of ways to do so around Oct. 18. Breaching that deadline could have caused havoc in the financial system and even sent the U.S. economy into a recession, economists warned. Despite frequent clashes about the debt ceiling over the years, Congress in modern history has always averted default. Have a question, comment, or story to share? You can reach Diccon at dhyatt@thebalance.com.
