Bohemia, NY (PRWEB) October 12, 2013
Financing expert Alec Sohmer responds to an article published by the Los Angeles Times, which details the potential of the U.S. government defaulting on its debts.
According to the Los Angeles Times article published on October 2nd titled “Finance executives warn Washington not to risk a government default,” the U.S. government has experienced shut downs before, but it has never defaulted on its debts. Washington lawmakers have been in a similar situation recently, but the stalemate in Congress over raising the $16.7-trillion debt limit could cause the first-ever federal default.
The article says this could cause panic on Wall Street and cause “severe economic harm.” It also has the potential to affect the job market and possibly trigger another recession. In an effort to make a difference, many finance executives from top companies went to Washington to persuade politicians to reach a decision soon before the U.S. economy crumbles.
In the article, Brian Moynihan, chief executive of Bank of America, says, “"There's no debate that the seriousness of the U.S. not paying its debts, whether it's Social Security checks, small business loans … all the way up to the Treasury notes and bills, is the most serious thing we have.”
Alec Sohmer, a financing specialist and managing director at Plymouth Rock Capital, agrees, expressing that a governmental default could be detrimental to a slowly recovering economy. “If Washington doesn’t reach a decision before October 17th, the results could be disastrous, and bring us back to square one,” he says. “Some financial analysts believe there’s a 40 percent chance that Congress would not reach a decision and fail to raise the debt limit by that October date.”
Regardless of policy differences, Congress needs to reach a decision quickly, Sohmer adds. “Allowing the government to default on its debt is harmful to everyone, and it should not be used as a threat to change policy issues,” he says. “Negotiations on this plaguing issue should be made safely after the decision to raise the debt ceiling is made. Lawmakers should not default on debt just to prove a point.”
Alec Sohmer, a strategic financing leader and co-founder of Plymouth Rock Capital, has 20 years of Board-level experience. He has served in many interim management positions for businesses requiring significant turnaround or restructuring. He is able to increase revenue streams by utilizing a variety of line management techniques. In his two decades of experience, he has dramatically increased revenues of businesses by identifying untapped markets.