Jerome Powell will "underwhelm everyone and not overwhelm anyone," one economist saysMarket Insiderread more
The unspecified action comes after the U.S. accused Iran of carrying out the weekend attacks on critical Saudi oil installations.Politicsread more
Oil prices retreated after President Donald Trump said he ordered the Treasury Department to "substantially increase" sanctions on Iran.Energy Commoditiesread more
Corporate executives and money managers have grown increasingly pessimistic about the economy as growth around the world slows.Trader Talk with Bob Pisaniread more
Mortgage applications to purchase a home increased 6% for the week and were a strong 15% higher annually.Real Estateread more
U.S. homebuilding surged to more than a 12-year high in August as both single- and multi-family housing construction increased.Economyread more
Here's CNBC review of the Apple Watch Series 5, which makes a step forward with an always-on display and a useful compass that can help you find your way on Apple Maps.Technologyread more
The electric car manufacturer is offering auto insurance to its owners in California, with plans to expand to other states later on.Personal Financeread more
Facebook unveils the Portal TV, a streaming device that comes with a camera and microphones for making video calls via television.Technologyread more
Blackstone's Joseph Zidle predicts the Fed will cut rates but says Wall Street won't get what it wants, and stocks could fall as much as 20%.Futures Nowread more
Like many people, professional investors here do not really think the United States will default on its debt.
But even if it did, what could they do? Many see the outcome as a sort of financial nuclear winter, or at least a cliff, and have little inkling of what's on the other side.
Luke Bartholomew, an investment analyst at Aberdeen Asset Management, summed up the sentiment.
(Read more: How a debt ceiling standoff could help the banks)
"We haven't done anything to hedge our global government bond fund portfolio for an explicit default," he said, "because: a) we think the chances of default are still small; and b) the consequences would probably be so systemic and devastating it would be very difficult to hedge."
His views largely reflected those shared by a number of money managers interviewed over the last week in London, Europe's financial nerve center. As the city contemplates the abyss that it hopes will never come, heads shake at what they see as the Americans' inability to operate a government. The prevailing belief seems to be that crisis will be averted and that the politicians will come to their senses at the 11th hour. The alternative is simply too dire to contemplate.
"Like most people on this side of the pond, we watch with incredulity, really, at the positions they have painted themselves into and the unnecessary stress and damage," said Tim Haywood, the head of the fixed-income unit at the London office of GAM, an asset management firm based in Zurich. He said his firm had considered pursuing a complex hedging strategy, but came to view it as unworkable.
"Most of us put down the chance of an unresolved default of U.S. Treasurys at below 1 percent," he said. "However, even with such a low percentage, the ramifications of unresolved default would be so serious that clearly we have to check everything to ensure that we survive and our customers' capital is preserved."
(Read more: Relax! Government won't run out of money Thursday)
He said his firm was not heavily invested in the American dollar and had a cash allocation that was more focused in Europe. But they were holding "a small number of Treasury calls," or options contracts that give them the right to buy United States Treasury bonds, which, he conceded, "sounds completely counterintuitive."
"It may be that the risk-free asset does re-emerge as being U.S. Treasurys after a calamity," he said.
For Johannes Müller, the chief economist at Deutsche Asset & Wealth Management, a unit of Deutsche Bank, "The possibility of a default is seen as very, very low, so we thought about a risk case, and formulated a risk scenario, but the probability is a symbolic one." He added, "I don't think by and large the market is anticipating a technical default."
What would happen if the United States defaulted on its debt?
"Oof," said Oliver Gregson, an executive at the wealth management division of Barclays. "Honestly, wouldn't want to go there. You would be talking about an event similar to '08, you really would."
Many, like Mr. Gregson, say they do not see the nominal debt ceiling deadline of Oct. 17 as the default doomsday.
(Read more: How safe is your money if the US defaults?)
"The U.S. is the world's largest economy, and they have a lot of things they could do to avoid that," Mr. Gregson said. "You have talk about a superbond, or minting a trillion-dollar coin, or Social Security or Medicaid payments might be impacted. We can get past the 17th — there are all sorts of things they could do."
He added: "I would say we're tactically cautious and strategically optimistic. We are mindful of the tail risk from the debt ceiling debate and possible default. Clearly those tail risks are substantial, but the reality of that actually happening is limited. The vested interest of both sides, Republican and Democrat, is substantial enough that we think sense will prevail."