The West has named the main problem in the event of a US default. According to the British newspaper The Economist, a default in the U.S. will force the world to look for an alternative to the dollar. The paper noted that without raising the U.S. debt ceiling in time, the U.S. Congress could bring the country to its first sovereign debt default in its modern history.
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Default in the U.S. could trigger a stock market crash and panic in the global economy, amid which there may be questions about replacing the dollar as the main reserve currency. The Economist writes about it.
The paper notes that if the authorities do not raise the ceiling of U.S. debt in time, U.S. Congress could bring the country to its first-ever national debt default, which could lead to a collapse in the stock market, skyrocketing unemployment and panic in the global economy.
After the default is announced, investors may start to invest in the dollar, as it has historically been a “safe haven” in times of crisis, but given the widespread unwarranted confidence long placed in the US, there will be questions about alternatives to the dollar and the American financial system, the paper said.
The paper believes that most countries will lose faith in American stability and it will become almost impossible to regain it.
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