The U.S. government is flirting with default on the world's most important risk-free financial instrument: Uncle Sam has issued or guarantees 55% of all triple-A-rated bonds, according to Nomura. But despite dire warnings by some policy makers during another weekend of stumbling debt-ceiling negotiations, most markets continue to snore at the threat. Why, the Wall St Journal asks.
First, most investors still can’t bring themselves to believe that even a fractured U.S. Congress would be stupid enough to force a default. Several days remain to secure a deal, and there will be wiggle room to prioritize payments and avoid a default for a short while after that…
Find out more at http://online.wsj.com/article/SB10001424053111903591104576468123234625808.html?mod=markets_newsreel
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