US Treasury to sell debt Shutdown, said officer

04 April 2011, 10: 42 am EDT by Vincent Del Giudice

(Updates with comment from Economist in the seventh paragraph).

April 4 (Bloomberg)--the Treasury Department will conduct its regular schedule of securities auctions in the event of a decision of the Government, a government official said today.The official spoke to Bloomberg News on condition of anonymity because he is not authorized to speak publicly. The Treasury borrows money through weekly sales of invoices, monthly sales of notes in the long term and 30-year bonds to fund the activities of the Government. "Based on the story, it is not a surprise that the Government will continue to need for funding to continue," said Ward McCarthy, Chief Economist financial at Jefferies & Co. Inc. in New York.Democrats and Republicans are working on a 2011 fiscal budget to avoid a decision of the Government when spending authority current ends April 8. " The Government has worked without formal 2011 budget, given that the fiscal year began October 1 last. Barrack téléphoné Obama Democratic Leader Harry Reid Senate and Republican House Chairman John Boehner on 2 April, urging them to resolve the impasse.Negotiators Chamber and the Senate, joined by the White House, are considering plans to reduce the budget of $ 33 billion. Legislators spent the $ 10 billion in reductions to date for the fiscal year. "Stir room '"the Government usually has some flexibility here that a judgment will probably first in a temporary suspension of non-essential government services,"said Chris Rupkey, Chief Economist financial with Bank of Tokyo-Mitsubishi UFJ Ltd. in New York. "The Treasury, finance, financing the deficit budget budget, regular auctions, is not a non-essential, especially when service foreigners possess more than 50 per cent of all the outstanding Treasury paper."Another scenario, failure by Congress to raise the Government debt limit could challenge the capacity of the Department of Treasury securities in the auction. The Treasury Board has estimated that the limit can be breached some time between April 15 and may 31 if the Government to test its debt limit, history has shown measures can still be taken to use the funds to avoid default. In November 1995, then - Treasury Secretary Robert Rubin announced the conversion of 61.3 billion to the Government of the securities held in two funds of federal employees cash benefits to meet expenses.March 31, the total debt of the Treasury Board subject to the limit was 14.218 trillion, with a debt limit of 14.294 billion, according to daily closing balance in cash to the Treasury released 1 April.

-Editors: Kevin Costelloe, Vince Golle

To contact the reporter on this story: Vincent Del Giudice in Washington vdelgiudice@bloomberg.net.

To contact the editor responsible for this story: Christopher Wellisz to the cwellisz@bloomberg.net

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