- US default threatens recovery, could lead to a global downturn
- It also raises questions about ability to defend national security interests
- Markets seeing possibility as growing downside risk
- That said, global economy remains in a better place than six months ago
Well, in some ways, this in itself is a tightening of financial conditions on its own. So, the Fed's rate hikes are just adding to that. There are certainly growing risks but at the end of the day, this should be something that gets resolved one way or another - even if it might run right down to the wire.
