The U.S. Treasury just announced the the debt ceiling has been breached, and that they’re are using emergency measures to pay the bills.
But whether or not the debt ceiling gets raised by August, legendary bond investor Jeff Gundlach believes the U.S. is heading for default.
In a presentation given last summer, Gundlach outlined why a U.S. debt default was inevitable.
Gundlach identified three ways out of the debt crisis: Cut, print or default. But cutting alone rarely works. Printing is limited when foreigners own your debt. As for the last option, he says “some type of polite default, at a minimum, will happen.”
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