In the final days of 2022, Goldman's economists predicted that "the biggest political risk" of 2023 will be the Congressional showdown over America's favorite periodic drama: the debt limit.
This is what the bank's chief economist Jan Hatzius said then: "The debt limit likely poses the greatest political risk next year, and we expect it to rival the 2011 episode in its disruption to financial markets and the economy. That said, we do not expect Congress to enact major fiscal changes. Republicans might press for spending cuts in a debt limit deal, but we do not expect substantial cuts next year. The White House might press for increased fiscal support, but this also looks unlikely as we believe a soft landing is more likely and a divided Congress would have difficulty responding to a recession even if one occurs."
"The bill comes due." - Baron Mordo