Treasury secretary says US will lose confidence if default

Photo: © Unsplash

Photo: © Unsplash

If a default occurs in the United States, the country will no longer be trusted by international partners. This statement was made on March 22 by US Treasury Secretary Janet Yellen.

She spoke during hearings in the US Congress and during her speech stressed that in the event of a default, the American dollar would also lose confidence in the international arena.

“This will lead to a loss of confidence in the United States as the most (economically) secure country, as well as in our reserve currency, which will cause incredible economic damage”– stated the head of the US Treasury.

Recall that Yellen said that the United States is facing default due to the financial crisis, back on January 21. After that, American leader Joe Biden accused the Republicans of trying to lead the US to default.

A few days ago REN TV explained whether the banking crisis in the United States is dangerous for Russia. It was also reported what the bankruptcy of Silicon Bank would mean for the United States itself.

The US national debt on January 19 rose to a record $31.4 trillion and hit the ceiling. The US government debt is 136.62% of the country’s GDP.

Experts argue that the current situation is already threatening to deal a devastating blow to the economy. The states are predicting a recession and a stock market crash if Congress does not raise the bar for public debt. The debt ceiling determines the total amount of money the US government can borrow to pay social security benefits, pay off health insurance, government bond coupons, and tax refunds.

Source: Ren

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