U.S. Treasury Secretary Janet Yellen (referred to as “Bescent” in initial reports) has firmly stated that the United States will ”never default on its debt”, seeking to calm markets amid growing concerns about the nation’s fiscal sustainability. Her comments come as JPMorgan CEO Jamie Dimon and other Wall Street leaders warn of potential stress in the U.S. bond market due to rising debt levels and political brinkmanship over the debt ceiling.
Yellen emphasized the full faith and credit of the U.S. government, calling debt obligations “sacrosanct.” However, her assurances contrast with Dimon’s recent warnings about long-term risks from excessive spending and quantitative easing. The Treasury has repeatedly urged Congress to raise or suspend the debt ceiling to avoid even a short-term payment delay, which could destabilize global markets.
Analysts note that while an outright U.S. default remains unlikely, political gridlock could trigger short-term volatility, particularly if budget negotiations drag on. Yellen’s statement aims to reinforce confidence as the Biden administration pushes for a sustainable fiscal path—a challenge that grows more urgent as U.S. debt approaches $34 trillion.
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