The Debt Limit and the High Cost of the Debt

News headlines are filled with speculations about the U.S. debt limit. Most prevalently, whether Treasury could be forced to prioritize interest payments to bondholders while delaying other government obligations when the debt limit binds, potentially as early as June. If Congress failed to raise the debt limit in time, prioritization of interest on the debt, before other government payments, is one likely outcome. Read Full Article »