US Default Inevitable: Fund Manager
By: Shai Ahmed
Wednesday, 13 Jul 2011
A U.S. default isn’t a matter of “if” but “when,” David Murrin, chief investment officer at Emergent Asset Management, told CNBC.
“It’s inevitable that the U.S. will default—it’s essentially an empire which is overextended and in decline—and that its financial system will go with it,” he said.
The question is: Does the U.S. default when it is forced to by the outside world, probably the Chinese, or does it take the option to default on its own terms in such a way that it may have a strategic advantage, Murrin said.
Republicans and Democrats are currently locked in a debate on how to cut the U.S. budget deficit, and on whether the $14.3 trillion debt ceiling should be raised. Both parties need to come to a consensus by Aug. 2, otherwise the country will be in a state of technical default.