Debt Deal Unlikely to Pass Before Thursday Deadline

Even the most optimistic are now conceding that it is all but impossible to get the debt limit raised before Thursday's deadline. What will happen is unknown. We are sailing in uncharted waters. Enough money will likely still be coming in from ordinary tax receipts to cover our bonds. But anything beyond that is up in the air. The simple math is that there is not enough money to fund non-discretionary spending (mandated by law) AND the discretionary spending that most people think of as obviously essential (military, law enforcement, public safety etc). And we have no idea how long the financial markets are going to stay calm.

So no, we are probably not going to default on the national debt (bonds) right away. But if this drags on, bad things are going to start happening... quickly.