Voting is underway in Washington DC on the deal that was struck late last night on raising the debt ceiling. McBee Strategic has provided this detailed analysis and below are a few more notable points to be aware of.
• President Obama reached an agreement with Congressional leaders last night on a multi-step deficit-reduction package expected to total $2.4 trillion over 10 years, to be accompanied by nearly matching increases to the debt limit.
• Last night’s agreement makes it almost certain the U.S. will not default this week. However, it’s not yet clear the U.S. can preserve its AAA credit-rating since $2.4 trillion falls well short of the $4 trillion standard cited by Standard & Poor’s.
• Spending cuts will be historic if not unprecedented, and the battle will continue likely throughout the 2012 election cycle; no tax increases; at least $2.1 trillion in debt ceiling headroom; requires defense to shoulder a large part of spending cuts.