UBS: August 2nd Isn't The Real Debt Ceiling Deadline

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Is August 2nd really the debt limit deadline?

Despite multiple statements from President Barack Obama and Treasury Secretary Tim Geithner that the government will not be able to meet all of its obligations after that date, a new UBS report sets the real deadline perhaps a week later.

“UBS analysis suggests (the U.S.) Treasury has the funds to make all payments until about August 8th – 10th,” wrote Chris Ahrens, head of interest rate strategy for the firm in a note obtained by The Wall Street Journal.

A study by the Bipartisan Policy centre last month reaffirmed the government position that the Treasury Department cannot fund all of its obligations on August 3rd. Default would no necessarily occur immediately if the government prioritizes interest payments.

Geithner repeatedly refused to comment on which bills would be paid after August 2nd in an interview with Fox News Sunday.

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