United States: National Debt Exceeds $36,000 billion

The U.S. Treasury Secretary, Janet Yellen, recently warned that the U.S. debt ceiling could be reached as early as mid-January 2025. According to her statements, the Treasury expects to hit this new limit between January 14 and January 23, at which point extraordinary measures will need to be taken to avoid a default.

United States: The debt ceiling could reach mid-January

The public debt ceiling is a legal limit on the total amount that the U.S. government is allowed to borrow to finance its existing obligations. In the United States, this limit has been suspended until January 1, 2025, but a new limit will be set on January 2, corresponding to the amount of debt issued by the Treasury Department. If this limit is reached, the Treasury will have to resort to extraordinary measures to continue financing government activities without failing to meet its payment obligations.

The extraordinary measures mentioned by Janet Yellen in her letter to Congress include accounting adjustments and deferrals of certain expenditures to free up funds and avoid an immediate default. These measures buy time, but they are not a long-term solution. If Congress fails to raise or suspend the debt ceiling again, the United States risks defaulting, which would have serious consequences for the economy.

Political tensions

Raising the debt ceiling has been a contentious political issue for years in the United States. Conservatives, in particular, are often opposed to increasing the national debt, which currently exceeds $36 trillion. Janet Yellen has urged Congress to act quickly to protect confidence in the country’s credit and avoid a financial crisis.

In summary, the current situation highlights the economic and political challenges facing the United States. Congress will need to make crucial decisions in the coming weeks to avert a debt crisis that could have serious repercussions. Could bitcoin be the long-awaited solution?