Goldman Sachs: US could default on its debt on June 8 or 9

Per Business Insider

Goldman Sachs recently said that they think the US could ultimately default on its debt on June 8 or 9. This came from a statement coming from the firm's chief political economist.

Alec Phillips, the chief political economist of Goldman Sachs, recently went on Bloomberg TV and talked about what he thought regarding the US's potential default on its debt. During that time, Phillips gave an actual date in mind when they thought that the US would default.

Phillips: "Our guess right now is that the real deadline is probably more like June 8th, 9th, that's when they're at sort of greatest risk,"

This comes as Janet Yellen, Treasury Secretary, gave an "X-date," which was on June 1. This is reportedly the date when the US will no longer be capable of paying its bills and is at risk of default.

Phillips, although gave no mention of the X-date during his remarks, gave a statement regarding what they thought Congress should do.

Phillips: "The reality is that Congress has to do this at some point very soon, and they should just go ahead and do it... So waiting for the last minute isn't necessarily the right move, even though we think that maybe they could go a little bit longer."

Yellen noted last month that the US default on debt would trigger what she described as an "economic and financial catastrophe." She commented how this would result in borrowing costs increasing into perpetuity and how future investments would become much more expensive.

During this time, she urged Congress to vote on raising or suspending the debt limit. She noted that they shouldn't wait until the last minute to do so.

In March, it was reported that the US debt default chances have over tripled. This comes as Congress struggled to reach a new deal when it came to the debt ceiling.

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