The US government is 24 hours away from running out of money as there is yet no deal to increase the debt limit. Thankfully, there has been no generalized financial panic as yet as there is still hope for a last-minute deal between two sides of a political system that is busy in dangerous brinksmanship. However, one corner of the market is suggesting that investors have started taking insurance against an eventual US default. The price of one-year US government credit default swaps (CDS) has climbed to record heights. It suggests that worries are building up, though there is no panic as yet. But for how long?
Source of the data: Morgan Stanley Research