‘Playing with Fire’: Citi CEO Warns During Virtual Roundtable About Defaulting if Debt Ceiling Isn’t Raised

Citi CEO Jane Fraser warned on Wednesday that the United States is “playing with fire” over possibly defaulting on its loans were the debt ceiling not to be raised by the Oct. 18 deadline.

During a business roundtable with President Joe Biden and senior officials in his administration, Fraser said acknowledged that she does not know “what the right legislative solution is,” but “from an economic perspective, we need to resolve this issue very quickly.”

She continued:

Every day of delay right now comes at an increasing price as we’ve begun to see in the markets, starting last Friday. America simply cannot default on its debt because the U.S. Treasury market is the bedrock of our financial system domestically and globally. And defaulting is going to cause lasting damage to the credibility of the United States with investors and in financial markets around the world.

But as you say, the ramifications are not limited to the markets. It’s already beginning to cause some damage in the economy. It will hurt consumers. It will hurt small businesses.

And it’s not an exaggeration to say that even small distortions in the Treasury market can cause taxpayers tens of billions of dollars over many years. Consumers can be burdened with higher borrowing costs very quickly whether they are putting something on a credit card or they’re getting a mortgage. And for small businesses trying to recover from the pandemic this comes at a very critical time.

So we just can’t wait to the last minute to resolve this. We are, simply put, playing with fire right now. And our country has suffered so greatly over the last two years the human and the economic cost of the pandemic has been wrenching. We don’t need a catastrophe of our own making to undermine the progress that is underway, so we really urge the administration and Congress to do what’s necessary to resolve the situation for the good of our economy, for the good of our country.

Watch above, via CSPAN.