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Debt ceiling default could crush credit
So what happens when we reach that new deadline?
As National Corespondent Kristine Frazao explains, we should be aware of just how disastrous a bond downgrade and debt ceiling default could be for all americans.
Whether it's now or early next year, experts say the shutdown of the U.S. government is nothing compared to what the U.S. defaulting on its debt would do for all.
"It's a bump in the road whereas I think a default could be a potential economic tsunami," said Gordon Gray, Director of Fiscal Policy with American Action Forum.
He says when the country of the world's reserve currency can't be trusted to pay its bills, it won't be able to borrow, which could lead to a cut-back in services like social security and medicare, a hike in taxes and that's not all.
"Your car payment will go up, the cost of your kids college education will go up and the cost of getting a mortgage on your house will go up," he said.
While lawmakers on both sides of the aisle like to preach fiscal responsibility - the shutdown alone is estimated to cost taxpayers three to four billion dollars and that's not counting the billions more in back pay that will go to pay hundreds of thousands of employees even though they weren't allowed to do their jobs. Signs of fear already apparent -when the respected rating agency fitch issued a warning it may downgrade the nation's AAA credit rating.
A threat that would stand now, four months from now or four years from now should the government decide to stop paying its bills on time.
"Definitely short term effect will be increase in the interest and the cost of the money and that of course is deterimental," said Joseph Parnes, President of Technomart Investment Advisors.
Dire warnings that come from flirting with disaster now or early next year.