Raise Debt Limit or Risk another Recession, says Lew

Treasury Secretary Jack Lew told members of the Senate Banking Committee failure to raise the debt limit could result in the rise of interest rates, possibly jeopardizing the nascent housing recovery, as well as lead to higher costs on retirement accounts and make it more expensive to buy a car or start a business. Noting the rise in interest rates recently that slowed mortgage applications, Lew suggested another hike resulting from failure to raise the debt limit, combined with spillover effects including loss of value in the dollar and credit market disruptions, could potentially result in another recession, according to housingwire.com. Sen. Pat Roberts (R-Kan.) says 70-80 percent of the American people want to limit spending and President Obama’s response is that he will not negotiate. MHProNews learned Lew responded, saying, “Congress needs to open the government and make it possible for us to pay our bills,” and then the president will negotiate.

(Image credit: housingwire.com)

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