U.S. Treasury Taking Steps to Avoid Debt Ceiling

As U.S. debt has soared past the $22 trillion level, the ongoing problem is once again catching some attention. It was recently reported that the Treasury Department is taking some extraordinary measures to avoid violating the debt ceiling as it could have significant effects.

Reuters reported that Treasury Secretary Steve Mnuchin sent a letter to House Speak Nancy Pelosi on Monday saying he was suspending investment in the Civil Service Retirement and Disability Fund and that a “debt issuance suspension period” would commence on Monday and run through June 5th.

The same article quoted Mnuchin as stating in his letter: “I respectfully urge Congress to protect the full faith and credit of the United States by acting to increase the statutory debt limit as soon as possible.” In other words, it may simply be time to kick the can down the road yet again.

Debt ceiling negotiations have become increasingly politicized in recent years. Lawmakers have looked to use the negotiations as a tool for achieving other ends. The ongoing disputes over government spending could potentially set the stage for a significant slowdown in the fall, as the Treasury will no longer have room to extend the ceiling past late September or early October.

A breach of the debt ceiling could have significant consequences for not only the U.S. but the global economy as well. A failure to raise the debt ceiling could result in a U.S. default. A default by the U.S. could have a severe impact on the nation’s credit rating and could cause a massive spike in interest rates, exacerbating the debt problem further. As the world’s largest economy, a U.S. default could potentially raise borrowing costs elsewhere as well, while also putting a major dent in global GDP.

Although the debt ceiling is likely to continue to be raised, the problem is not going away. In fact, every time the debt ceiling is raised, the problem gets worse. Whether it is next year, five years from now or 10+ years from now, the country will be forced to get its debt under control.

With a current tab of some $22 trillion, there may be no viable means of addressing the debt outside of currency debasement. Such a measure would involve the printing of more money to pay debt, lowering the value of each unit of currency in the process. This means that each and every dollar in circulation buys less good and services, making everything from milk to gasoline to clothing more expensive.

This situation is likely to deteriorate further in the years and decades ahead and now may be the ideal time to take steps to protect wealth and purchasing power. Fortunately, there is a simple solution: Buy gold-and lots of it.

Gold has been considered a reliable store of wealth and protector of value for centuries. Unlike fiat currency, it cannot be created out of thin air and carries no counterparty risk. Not only may gold hold its value during a currency debasement but, as a dollar-denominated commodity, it could potentially explode in value as the greenback weakens.

Adding this key asset class to your portfolio has never been easier, and never more important. Speak with an Advantage Gold account executive today about the potential benefits of gold ownership and to learn more about the vital role this asset may play in the years and decades ahead. Our associates are here to answer any questions you may have and can even show you how to build a significant allocation using an IRA account.

Don’t wait for the next major debt and currency crisis to erode your wealth and purchasing power further. Explore your options for gold ownership today. Call Advantage Gold at 1-800-341-8584 to get started now.

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