• United States Treasury Secretary Janet Yellen notified Congress last week that the country could default on its debt as early as June 1, if the Republican-dominated House of Representatives and President Joe Biden’s White House did not reach a consensus to raise or suspend the debt ceiling
  • When the federal government spends more than it brings in, in terms of taxes and other revenue, it runs up a budget deficit. Since 2001, this deficit has averaged $1 trillion annually. It then has to borrow money to meet its financial obligations, accruing debt
  • Analysts say there is no set post-default scenario since the U.S. has never actually defaulted on its debt before. They have warned, however, of a “catastrophic” situation for American and global financial markets.