if its borrowing limit isn't lifted by then, triggering an economic crisis, Treasury Secretary Janet Yellen has warned.
"I think it's ridiculous – it's always resolved, not that it's a 100% chance, but I think it gets resolved," Gross toldThe debt ceiling is a limit on how much the government can borrow, set by Congress. The US hit the $31.4 trillion mark on January 19 and can raise more money only if that limit is lifted – but the White House and the Republican-led House of Representatives can't agree on how to resolve the potential crisis.
Yields on short-term US Treasury bills have spiked in the past few weeks, with investors fretting that the ongoing deadlock in Washington will lead to a default. "The problem in the past has resulted in Treasury bill rates close to the point of potential default, moving higher by 50 or 100 basis points, and they've done that this time," he told Bloomberg TV.
"I would suggest for those that are less concerned, similar to myself, that they buy 1-month, 2-month Treasury bills at a much higher rate than they get with a longer-term Treasury bill," Gross added.
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