Recapping the day's news and newsmakers through the lens of CNBC.
Brinkmanship has its downside.
Remember the Great Recession? Well, start hoarding canned goods, drinking water and ammo, because Son of Great Recession could be even worse. That's the prediction coming from the U.S. Treasury, which says a default on Treasury debt could cause the credit markets to freeze, the dollar to plunge and interest rates to skyrocket.
Back when we were young and innocent, last week, most figured Washington wasn't dumb enough to let that happen. Warren Buffett has ratcheted up his rhetoric—last week he said even politicians aren't dumb enough to go too far down this path, but today, Buffet referred to the "extreme idiocy" in Washington.
The worries are growing stronger, according to an anxiety index created by Stanford University, which tracks factors like the level of disagreement among economists. Heeding the warnings perhaps, House Speaker John Boehner has told colleagues he won't let a default happen.
"Postponing a debt ceiling increase to the very last minute is exactly what our economy does not need—a self-inflicted wound harming families and businesses."
—Treasury Secretary Jack Lew
"Political uncertainty constrains business investment, especially on research and development, and reduces hiring and slows GDP growth ... If not for the logjam in Washington, the economy would now be much closer to full employment."
—Moody's Analytics Chief Economist Mark Zandi