America is currently facing an economic crisis. That is with the increasing conflicts of opinion between the ruling Democratic Party and the rival Republican Party regarding raising the debt limit of the country’s treasury. The country’s media has reported that if a solution to the crisis is not found soon, America may go bankrupt.
If the conflicts between President Joe Biden and the Republicans are not quickly resolved, the chances of the US temporarily suspending payments on bonds will increase. According to a report published by the ‘Financial Times’ newspaper, American economic analysts hope that President Joe Biden and Congress (Parliament) will be able to reach an agreement to avoid a temporary stoppage of bond payments.
Treasury Secretary Janet Yellen has said that if the White House and Congress fail to reach an agreement on the Treasury’s debt ceiling, the Treasury will not be able to provide money for government spending after June 1st.
Economists have shown that if the debt limit is not raised, the United States of America will not be able to pay the money for the bonds to the central banks of the foreign countries that have obtained the bonds, and then the credit ratings of the United States of America will fall. Also, economists have explained that the American government will not be able to pay American citizens monthly salary payments and health insurance for military members. (Reuters)
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