How might United States Bankruptcy affect other Global Economies

The US government is currently playing the most important and risky stake in history. If Democrats and Republicans don’t allow America to borrow more, or simply raise the debt ceiling, the world’s largest economy, $31.4 trillion in debt, will go bankrupt.
The US has until June 1 to reach a final agreement on raising the debt ceiling to avoid bankruptcy. If they fail to do so, the effects could be “very catastrophic,” according to US Chancellor Jeremy Hutt.

But what effect can this situation facing America have on the American and global economy and on you?

First of all, keep in mind that America will not go bankrupt due to debt, experts said.
However, if that happens, Simon French, chief economist at investment bank Panmore Gordon, says, referring to the global banking crisis in 2008, “then it will make the global economic crisis a Tea Party.”

If the U.S. does not raise its debt ceiling, it will not be able to borrow more and may then run out of money to pay for benefits, utilities and other essential payments to its people at government expense. Is. “In this case, the U.S. will stop paying people under welfare and financial assistance will be cut off to help people with their ability to spend and pay their bills,” said Russ Mold, investment director at AJ Bell. will affect, so it will harm the country’s economy.’

The White House’s Council of Economic Advisers has estimated that the U.S. economy could shrink by 6.1 percent from its current size if the government doesn’t reach an agreement to raise the debt ceiling in the long run.

“Bankruptcy may be just the beginning of an American recession,” says Mohamed El-Erian, president of Queen’s College at Cambridge University and an economist.

Which will have profound effects on the world, including the United States’ main trading partner, the United Kingdom.

He says that the United States is the largest trading partner in the world. In this case, it will buy less goods from around the world.

Al Arian doesn’t think a recession in the US will slow down the economy in the UK either, but Simon French is ‘100 per cent’ sure of it.