of the U.S. government's top finance officials are taking a closer look
at what might happen if deadlocked debt talks between the president and
lawmakers turn into an all-out stalemate.
Treasury Secretary Timothy Geithner and central bank chief Ben Bernanke
met in Washington Friday with William Dudley, who heads the Federal
Reserve's New York branch.
In a joint statement, the three said they remain confident Congress will
raise the country's borrowing limit before the government runs out of
money on August 2. But they also said they discussed the implications
for the world's largest economy if Congress fails to act.
Both Secretary Geithner and Federal Reserve Chairman Bernanke have
previously warned of catastrophic consequences if the U.S. government is
no longer to pay all of its bills.
On Thursday, the chief of the Federal Reserve's Philadelphia branch told
Reuters that Fed and Treasury Department policy makers are in
“contingency planning mode,” trying to determine which debts would be