U.S. Treasury Secretary Janet Yellen.

(Associated Press)

[Financial Channel/Comprehensive Report] U.S. Treasury Secretary Janet Yellen (Janet Yellen) warned on Friday (20th) that if the federal government exhausts extraordinary measures and fails to raise the debt ceiling, Americans may face serious consequences and may have serious consequences. Global finance has wide-ranging implications.

"CNN" reported that the United States hit the US$31.4 trillion (about NT$950 trillion) debt ceiling set by Congress on Thursday (19th), forcing the Treasury Department to start taking unconventional measures to make the government pay its bills.

Yellen said it was unknown exactly when these measures would be used, but it could be as early as early June.

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Yellen pointed out in an interview that after the relevant measures are exhausted, if Congress still fails to raise the debt ceiling, the rating of the United States may decline.

Yellen said the fallout from the federal government's missed payments could turn out to be as widespread as the "global financial crisis."

Once that happens, Yellen said, borrowing costs will increase and, most importantly, failure to make payments when due will undoubtedly lead to a U.S. recession and possibly a global financial crisis.

This would certainly weaken the dollar's role as a reserve currency in global transactions, while many Americans would lose their jobs and their borrowing costs would surely rise.

The Republicans demanded cuts in spending as a condition for adjusting the debt ceiling, but the White House retorted that it would not make any concessions or negotiations on raising the debt ceiling.

So far, Yellen's warning has not sparked bipartisan discussions, with both Republicans and Democrats reiterating their tough stances over the past week.

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