{"id":33082,"date":"2023-05-03T20:09:15","date_gmt":"2023-05-03T20:09:15","guid":{"rendered":"http:\/\/lynettelockhart.com\/client\/feds-powell-dont-assume\/"},"modified":"2023-05-03T20:14:49","modified_gmt":"2023-05-03T20:14:49","slug":"feds-powell-dont-assume","status":"publish","type":"post","link":"http:\/\/lynettelockhart.com\/client\/feds-powell-dont-assume\/","title":{"rendered":"Fed&#8217;s Powell: don&#8217;t assume Fed can shield U.S. economy from debt limit default"},"content":{"rendered":"<p>By David Lawder<\/p>\n<p>WASHINGTON (Reuters) -The U.S. Federal Reserve is unlikely to be able to protect the U.S. economy from the damage caused by a failure to raise the federal debt ceiling, Fed Chair Jerome Powell said on Wednesday, adding that the government should never be in a position where it is unable to pay all of its bills.<\/p>\n<p>Powell told a news conference after the Fed&#8217;s latest rate hike decision that resolving the debt ceiling standoff between Republicans and Democrats was a matter for Congress and the Biden administration.  <\/p>\n<p>&#8220;We don&#8217;t give advice to either side,&#8221; Powell said. &#8220;We would just point out that it&#8217;s very important that this be done.&#8221;<\/p>\n<p>A U.S. default would be unprecedented and have &#8220;highly uncertain&#8221; and &#8220;quite diverse&#8221; consequences for the U.S. economy, Powell said, but he declined to enumerate them. <\/p>\n<p>&#8220;We shouldn&#8217;t even be talking about a world in which the U.S. doesn&#8217;t pay its bills. It just shouldn&#8217;t be a thing,&#8221; Powell said.<\/p>\n<p>&#8220;No one should assume that the Fed can really protect the economy and the financial system and our reputation globally from the damage that such an event might inflict,&#8221; he added. <\/p>\n<p>On Monday, U.S. Treasury Secretary Janet Yellen said the Treasury&#8217;s best estimate was that a default on U.S. payment obligations due to insufficient cash could come as early as June 1, raising alarm bells on the need for urgent action to increase the borrowing cap.<\/p>\n<p>President Joe Biden reacted by summoning the four top Congressional leaders to the White House for a May 9 meeting, but it remained unclear whether he would open negotiations over Republicans&#8217; spending cuts demands or continue to insist on a &#8220;clean&#8221; debt ceiling increase.<\/p>\n<p>Yellen has warned that a debt ceiling default will cause &#8220;severe hardship&#8221; to American families by raising borrowing costs, and harm the U.S. global leadership position.<\/p>\n<p> (Reporting by David Lawder; Editing by Chris Reese and Daniel Wallis)<\/p>\n<p><a href=\"http:\/\/lynettelockhart.com\/client\/feds-powell-dont-assume\/federal-reserve-chairman-powell-holds-a-news-conference-in-washington\/\"><img decoding=\"async\" src=\"http:\/\/lynettelockhart.com\/client\/wp-content\/uploads\/Reuters_Direct_Media\/USOnlineReportBusinessNews\/tagreuters.com2023binary_LYNXMPEJ420UI-VIEWIMAGE.jpg\" alt=\"tagreuters.com2023binary_LYNXMPEJ420UI-VIEWIMAGE\"><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>By David Lawder WASHINGTON (Reuters) -The U.S. Federal Reserve is unlikely to be able to protect the U.S. economy from the damage caused by a failure to raise the federal debt ceiling, Fed Chair Jerome Powell said on Wednesday, adding that the government should never be in a position where it is unable to pay [&hellip;]<\/p>\n","protected":false},"author":8,"featured_media":33083,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"spay_email":"","footnotes":""},"categories":[1213],"tags":[1223],"class_list":["post-33082","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-u-s-business","tag-updated"],"jetpack_featured_media_url":"http:\/\/lynettelockhart.com\/client\/wp-content\/uploads\/Reuters_Direct_Media\/USOnlineReportBusinessNews\/tagreuters.com2023binary_LYNXMPEJ420UI-VIEWIMAGE.jpg","_links":{"self":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts\/33082","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/comments?post=33082"}],"version-history":[{"count":2,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts\/33082\/revisions"}],"predecessor-version":[{"id":33161,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/posts\/33082\/revisions\/33161"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/media\/33083"}],"wp:attachment":[{"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/media?parent=33082"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/categories?post=33082"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/lynettelockhart.com\/client\/wp-json\/wp\/v2\/tags?post=33082"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}