Tag Archives: california

Bernanke: US Debt Crisis

2 Mar

From The Washington Times:

With uncharacteristic bluntness, Federal Reserve Chairman Ben S. Bernanke warned Congress on Wednesday that the United States could soon face a debt crisis like the one in Greece, and declared that the central bank will not help legislators by printing money to pay for the ballooning federal debt.

Recent events in Europe, where Greece and other nations with large, unsustainable deficits like the United States are having increasing trouble selling their debt to investors, show that the U.S. is vulnerable to a sudden reversal of fortunes that would force taxpayers to pay higher interest rates on the debt, Mr. Bernanke said.

Australian banks source almost all their funding from the international capital markets. It is inevitable that a debt crisis in Europe, or America, will drive up funding costs for Australian banks too, who will (of course) put the squeeze on Australian borrowers.

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