- US Runs Out Of Cash As Soon As October 22 Revised BPC Forecast Shows!
by Tyler Durden, www.zerohedge.com
The BPC, whose initial analysis of the US default has become the staple “go-to” analysis for Treasury cash obligations and key events in the days surrounding and following the X-Date, has released a new update on when the US runs out of money. The latest: October 22 – November 1. Which means that if it so desires, the GOP can and probably will delay a debt ceiling bargain until the last possible moment which may well be, appropriately enough, Halloween. In the meantime, the US Treasury now has about $40 billion in total cash on hand and available extraordinary measures and declining fast.
The latest complete note:
As BPC’s X Date Window Narrows, Economic Risks Grow
– BPC’s Updated X Date Range: October 22 – November 1
– Major Debt Rollovers: October 17 – $120 billion; October 24 – $93 billion
– Major Payments Due During X-Date Range: $12 billion in Social Security benefits on October 23; $6 billion in interest on the public debt on October 31; over $55 billion in major payments on November 1
– Likely Impact of Shutdown on X-Date Range: If resolved shortly – negligible; if prolonged – a couple days
Updated data on Treasury cash flows through the first week of October show that the range for the Bipartisan Policy Center’s (BPC) X Date – the date on which the United States will be unable to meet all of its financial obligations in full and on time – has narrowed to between October 22 and November 1. The updated range is consistent with BPC’s earlier estimate.
No one can predict with absolute certainty the date and time when Treasury will have exhausted all its extraordinary measures and run out of cash on hand. Therefore, policymakers should not assume that they have until October 22 to make decisions concerning the federal debt ceiling. In all likelihood, markets will begin to demand higher interest rates to bid on and hold United States debt. In fact, this behavior is already apparent in short-term Treasury debt interest rates. The U.S. Treasury will roll over at least $302 billion in outstanding federal debt between October 15 and October 31; $120 billion of debt is scheduled to mature on October 17.