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View Diary: About the debt limit - could someone explain this to me? (19 comments)

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  •  That's an excellent analogy (0+ / 0-)

    Accurate and easy to understand.

    Defaulting on outstanding debt by not raising the debt ceiling has nothing to do with questioning the validity of the debt. It's valid...it's just not getting paid. There was a technical default on a small sliver of T bills in 1979; the glitch got fixed, the bondholders were paid..just not timely.

    If the debt was invalid, though, it could not legally be paid, even if the issuer had plenty of cash.

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