Wednesday, October 9, 2013

As U.S. approaches debt ceiling, fears of global recession increase

SEOUL — For global leaders, the political crisis that has shut down Washington represents the most vexing kind of problem, one that they have virtually no means to stem but that could soon wreak economic havoc on their own shores.
If a divided Congress does not raise the federal debt ceiling in the coming weeks, the U.S. government — the world’s largest borrower — would suddenly be unable to pay its bills, a failure that would stagger markets from Tokyo to London and potentially drive the global economy into recession.Some in Europe and Asia say they are stunned at the quixotic partisan fervor shaking global economic pillar.
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That default scenario is bringing increasingly urgent pleas from foreign leaders, some who describe their grave concern, others who chide the United States about the risks of political brinksmanship, beg its leaders to act responsibly and wonder whether the world’s superpower is showing some cracks.
“This is highly important for all of us,” Russian President Vladi­mir Putin said this week. “I am hopeful that all the political forces in the United States will be able to resolve this crisis as quickly as possible.”

Although the mood from afar hasn’t turned to panic, some in Europe and Asia say they are utterly stunned by the quixotic partisan fervor shaking the pillar of the global economy.

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