Treasury watches national debt limit
TEXT OF STORY
Steve Chiotakis: The Treasury Department said this morning it’ll start winding down one
of the emergency programs it created to ease the financial crisis. Officials are trying to avoid hitting the national debt limit.
Marketplace’s New York Bureau Chief Amy Scott explains.
Amy Scott: The Treasury Department says it plans to reduce the size of its so-called Supplementary Financing Account from around $200 billion to $15 billion. The account was set up to help fund the government’s financial rescue programs.
Joseph Brusuelas with Moody’s Economy.com says those programs were always meant to be temporary.
Joseph Brusuelas: This is a positive step. This represents the fact that there’s less demand for these emergency measures, and that the economy is actually on the mend.
The move also buys Treasury some time before it hits the national debt limit of $12.1 trillion. Treasury Secretary Timothy Geithner has asked Congress to raise that ceiling. By scaling back the supplementary account the Treasury takes a small bite out of its outstanding debt.
In New York, I’m Amy Scott for Marketplace.
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