Normally I just use Treasury Direct’s Debt to the Penny. That lags by a day. The number is $11,974,737,715,216.11, but there was a $28 billion 4-week auction today. It depends on whether the bills paid on Monday were accounted for in today’s figure. We pay more bills on Thursday, so it’s likely that we’ll drop back below the 12T mark. Remember that Congress hasn’t yet upped our debt ceiling from $12.1T, so we’re pretty close to the limit. I wonder what happens if the government violates their own completely arbitrary limits on debt. How badly would it suck if they gave us a $20 over-limit fee?

I see a few possibilities:

1. Congress raises the limit — This would be boring. It is also the most likely scenario.

2. Auctions are deferred / canceled — This has been discussed. This is not a good idea. The demand for treasuries is quite strong (some think bubble territory) right now. The consequences of spooking that market are potentially devastating, and things can’t get much better, so why risk it?

3. The limit is ignored — This hasn’t been discussed, and I have some concern about how this move would be interpreted by our foreign investors. Again, given how good things are right now, rocking the boat doesn’t seem like a good move.

4. Spending is cut — This isn’t even being considered. This would be negatively interpreted by the stock market. Something is going to trigger the next move down, and this would be an absolute gift to short sellers.

Once again, things are very fragile. Our debt financing terms are great right now. While that could change instantly (if those calling a bubble are correct), there’s no reason to actively provoke such a reaction. There has never before been such a wide range of possible outcomes for so few policy decisions. As usual, I’m extremely pessimistic.

Update

We won’t actually know until after the settlement date for the auction. That would be Thursday (and will include Monday’s auctions as well, but paid off debt will be subtracted), which would be reflected on Friday’s update. It will be close.