Monday, December 9, 2013
In a Wednesday interview, reporter Kevin Miller found that Maine's Senator Susan Collins is somewhat skeptical of the looming default deadline. Here's a quote from Miller's story:
“I’ve been here long enough when we’ve come to what was supposed to be the date of default and the Treasury finds a way to shift obligations or payments . . . in a way that gives us a little more time,” Collins said. “However, I do not doubt that we are coming close to the point where we will need to do something about the debt ceiling.”
Meanwhile, financial markets have been a lot more active than Congress has been. Below is a chart showing the yield rates on short-term Treasury bonds. These 1-month and 3-month bonds typically generate very low, near-zero interest rates, because they're usually regarded as very low-risk investments.
But that attitude has changed over the past week or so. As we edge closer to the debt default deadline, investors are getting skeptical about whether the U.S. treasury is really such a safe place to store their money, and as a result, they're demanding dramatically higher rates of return from these short-term t-bills:
Commercial Confidential tracks Maine's business leaders and economic indicators.
I'm an economics wonk and an online content producer for the Portland Press Herald.
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