The First Debt Ceiling Crisis
13 Pages Posted: 6 Jul 2016 Last revised: 11 Nov 2017
Date Written: 2016-06-01
Abstract
In the second half of 1953 the United States, for the first time, risked exceeding the statutory limit on Treasury debt. This paper describes how Congress, the White House, and Treasury officials dealt with the looming crisis—by deferring and reducing expenditures, monetizing “free” gold that remained from the devaluation of the dollar in 1934, and, ultimately, raising the debt ceiling.
Keywords: debt ceiling, monetization of gold, U.S. Treasury
JEL Classification: E42, H63, N22
Suggested Citation: Suggested Citation
Garbade, Kenneth, The First Debt Ceiling Crisis (2016-06-01). FRB of NY Staff Report No. 783, Available at SSRN: https://ssrn.com/abstract=2803867
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