A U.S. debt default would have an “adverse impact” on the dollar’s role as a global reserve currency, warns Treasury Secretary Janet Yellen. According to Marc Chandler, managing director at Bannockburn Global Forex, Yellen’s view is in line with that of Fed Chair Jerome Powell: The U.S. would likely be unable to shield the economy from the damage created by not raising the debt ceiling. “If the U.S. does default, that would … just accelerate the process in which the U.S. is seen as being in decline,” says Chandler. “Even bringing negotiations down to the wire would marginally erode confidence in the U.S.,” agrees AGF Investment’s Tom Nakamura. In other news, a study by the Senior Citizens League shows Social Security has dropped 36% since 2000, and the organization predicts the cost-of-living adjustment for 2024 will be 3.1%. As concern for the economy ramps up, experts such as JPMorgan suggest that investors turn to gold as a safe-haven asset. According to award-winning financial writer Brett Arends, the “debt ceiling nightmare” could be a “dream” for gold investors.

MarketWatch/Vivien Lou Chen
What happens to the dollar if U.S. debt ceiling isn’t raised?

Time is running out for lawmakers to forge an agreement on the U.S. debt ceiling, with the chance that a possible government default would likely impact the U.S. dollar.

The greenback has already been in a slump for more than seven months, weighed down by signs of a weakening U.S. economy plus the prospect of the Federal Reserve pausing its interest rate hikes soon and even cutting borrowing costs.

The ICE U.S. Dollar Index DXY, -0.24% is down 11 percent since late September. Now, Treasury Secretary Janet Yellen is warning that a default on U.S. debt would have an “adverse impact” on the dollar’s role as a reserve currency, a scenario that’s been much speculated upon and many have pushed back against.

Continue reading, here.

Red Rock Secured/Kaylee Merchak
Gold Rose Nearly 30% During 2011 Debt Ceiling Crisis. Could it Happen Again?

Democrats and Republicans are once again going head-to-head over raising the federal government’s debt ceiling, but this time headlines are riddled with worries of an increased risk of a possible default.

Since 1960, Congress has acted to either permanently raise, temporarily extend, or revise the definition of the debt ceiling limit 78 times.

We technically hit the $31.4 trillion ceiling on Jan. 19, 2023. Since then, the Treasury Department has been forced to implement what Treasury Secretary Janet Yellen calls “extraordinary measures” to keep paying its debt on time.

You can read the full article, here.

MarketWatch/Jessica Hall
Social Security benefits lose 36% of buying power since 2000 – study

More than two-fifths of baby boomers are nearing retirement with no retirement savings.

That fact may surprise you if you are a typical white-collar worker, dwelling in a corporate culture of near-universal retirement coverage, encouraged to save a half-million dollars or more before taking the gold watch.

But many Americans work for smaller companies that don’t offer retirement savings, or are self-employed, or live paycheck to paycheck.

You can read the full article, here.

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