Behind The Mic With Joe Mathieu: Default Would Dwarf Shutdown
BOSTON (CBS) – We’ve been reporting on the impact of the partial government shutdown for a week now. And each day there’s another story of how it’s hurting someone or something.
Just today we read about two dozen military vets at Northeastern University who have lost their tuition assistance because of the shutdown.
News like this is local – if you lost a job or a paycheck because of the shutdown, nothing could be bigger.
But we’re told this won’t even compare with what would happen if there’s no deal to raise the debt ceiling later this month.
Treasury Secretary Jack Lew says that would force the U.S. to default on its debt for the first time ever. And, he says, that could cause another recession.
No wonder Wall Street and financial markets around the world are getting nervous.
But there has been a silver lining to this in the form of lower oil prices and interest rates. Good for people filling the tank or borrowing money for a home or something else.
But it’s hard to celebrate that when you consider they are falling because the markets are pricing worst case scenarios in case the shutdown and possible default lead to a recession. That of course would kill demand and pull prices lower.
So enjoy them while they’re here. Even if they’re down for all the wrong reasons.
Follow Joe on Twitter @joemathieuwbz