Happy New Year! Debt limit to be reached on New Year's Eve

Now comes the scare tactics from Treasury. Politico: Treasury Secretary Timothy Geithner warned Congress on Wednesday that the nation will hit its debt ceiling on New Year's Eve - but that the administration will again take a series of so-called extraordinary measures to hold off default. In a letter released Wednesday, Geithner said the extraordinary measures by the Treasury Department will give the government about $200 billion of breathing room, which would typically give the nation about two more months until it faces default on its legal obligations. But Geithner said because of the unresolved fiscal cliff, this situation was different. "Given the significant uncertainty that now exists with regard to unresolved tax and spending policies for 2013, it is not possible to predict the effective duration of these measures," Geithner wrote. In fact, with tax increases and mandatory spending cuts set to kick in as part of the fiscal cliff, Treasury may be able to hold off...(Read Full Post)