“Grey Rhino Risk: The Devastating Consequences of a U.S. Default on Its Debt”

Investors know this risk under the name of “grey rhino”: the gray rhinoceros, which we know exists, but whose extreme rarity leads to underestimating its occurrence and its potentially devastating consequences. A default by the United States on its debt is one of them, the most formidable of all in terms of financial stability. This is why the stakes of the battle around raising its ceiling, which could make it impossible for the Treasury to borrow, cannot be underestimated.