Will the US go bust?

Well I think this will be the breaking of Obama if he lets the US default even technically that will send their economy into a tail spin - hitting hard just when he is due for re-election.

If he compromises too much on welfare etc that will also do him a lot of harm with his grass roots support.

Its a tough call - but what ever happens its spooked a lot of people which in itself is bad enough.

I would bet big money that the whole thing will be sorted out.

Cutting it close:

BBC News - Q&A: Why has the US not agreed a new debt ceiling?

What happens if no deal is reached by 2 August?
The US could be in default, something Tim Geithner has said would be "catastrophic", and President Obama has warned could tip America back into recession.

What do academics believe will happen if the US defaults?
Interest rates on credit cards, car loans and home mortgages could rise sharply, says George Washington University Professor Julius Hobson.

He adds that global financial institutions around the world holding AAA-rated US Treasury notes and bonds would see the value drop."

See what happens next week

This weeks correct prediction prize goes to Harvey!

Obama unveils deal with Congress leaders

Hmmm how many zero's is $17 Trillion...

Not to worry they can always borrow of apple

Looks like they are OK for now. If the US goes bust then it could be the end of civilisation as we no it, the knock on effect would be devastating.

Except for Mr Burns who has a few $'s