This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

World Finance Officials Focus on Global Risks

By Marjorie Olster and Martin Crutsinger

WASHINGTON -- World finance officials pledged on Saturday to deal with new risks to the global recovery while they kept up pressure on the United States to address the biggest threat of all -- a market-rattling default on U.S. debt.

The International Monetary Fund's policy committee said the United States needed to take "urgent action" to address the budget impasse that has blocked approval of legislation to increase the government's borrowing limit before a fast-approaching Thursday deadline.

U.S. Treasury Secretary Jacob Lew, who shuttled between the global finance talks and negotiations with Congress over the debt ceiling, has warned that he will exhaust his borrowing authority Thursday and the government will face the prospect of defaulting on its debt unless Congress raises the current $16.7 trillion borrowing limit.

Across town from the global finance meetings Saturday, an effort at the Capitol to pass a one-year extension of the borrowing limit failed to get sufficient votes. But in a more hopeful sign, negotiations to end a partial government shutdown, now in its 12th day, and raise the debt ceiling began between Democratic and Republican Senate leaders.

Global finance officials were nervously monitoring those talks during their three days of discussions, held around the annual meetings of the 188-nation IMF and its sister lending agency, the World Bank.

"I think it is unthinkable that an agreement won't be found," Mario Draghi, head of the European Central Bank, told reporters Saturday, expressing the hope that a resolution could be found soon.

"If this situation were to last a long time, it would be very negative for the U.S. economy and the world economy and could certain harm the recovery," he said.

Asked what might happen if the U.S. budget debate were not resolved for six months or more, Singapore Finance Minister Tharman Shanmugaratnam, the chairman of the IMF committee, said it would be harmful to the entire would because it would be a blow to the confidence that is needed for businesses to make investment decisions.

"If we don't clear resolution of the U.S. debt issue, it is hard to see how that confidence will come back so it is a critical issue for all of us," he said.

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,164.95 -251.90 -1.45%
S&P 500 1,994.99 -26.26 -1.30%
NASDAQ 4,635.24 -48.1670 -1.03%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs