The US Treasury announced last Friday the suspension on pension funds payment. This was to ensure that the state remains under its $16.7 trillion debt limit. This extraordinary measure that the Treasure took was to raise the borrowing capacity of the federal state. In fact, it has provided a $160 billion addition that in total was accounted to reach $260 billion more borrowing capacity.
The moment the debt limit is raised, Treasury Secretary Jack Lew assured that the G-Fund, otherwise known as the Government Securities Investment Fund, will be distributed as a whole. This was stated in a written letter by the secretary to the US Congress. The treasury official; however, refused to provide exact dates or even estimates to when the Congress will raise the said limit. With a prior statement, the Treasury said that it has to continue paying the US its obligations until after September 2, Labor Day.
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