Another debt ceiling debacle could sink the economy
Last year's Congressional debt standoff hurt consumer confidence more than the collapse of Lehman Brothers, Betsey Johnson and Justin Wolfers write. This time could be worse. Read more at Counterparties
U.S. would need more borrowing if deflation sets in: Summers
WASHINGTON |
WASHINGTON (Reuters) - The United States would have to increase its borrowing if deflation sets in and the economy collapses further, White House economic adviser Lawrence Summers said on Friday.
"If deflation sets in, if the GDP (gross domestic product) collapses further, if the consequences of that collapse for the financial system and even just the insured parts of the financial system, if that happens, the magnitude of the federal borrowing as large as it is today will be dwarfed, will be far, far larger," he said at the Brookings Institution.
(Reporting by Tabassum Zakaria; Editing by Chizu Nomiyama)
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