SUMMARY

• With only 11 days left before a potential default, President Joe Biden and House Speaker Kevin McCarthy are scheduled to meet for resuming negotiations on the debt ceiling.
• The Republicans in the House remain firm on their stand, refusing to raise the debt ceiling limit unless Biden and lawmakers agree to future spending cuts.
• Treasury Secretary Janet Yellen warns of an imminent economic catastrophe if the debt ceiling isn't raised, with potential outcomes akin to the Great Recession.

With only eleven days left before a potential debt default, President Joe Biden and House Speaker Kevin McCarthy are scheduled to rendezvous at the White House on Monday. This meeting aims to recommence dialogues surrounding the pressing issue of the debt ceiling, as reported by NBC News.

McCarthy described his Sunday call with Biden as constructive and shared that both parties' staff would return to the negotiating table later that day. A representative from the White House verified the planned 6 p.m. restart of discussions, adding that the exact timing of Monday's meeting between Biden and McCarthy is yet to be disclosed.

It is paramount to elevate the debt ceiling to allow the government to fulfill spending obligations already sanctioned by Congress and the President, thereby averting default. The Republicans in the House, however, have held their stance that they will not accede to raising the limit unless Biden and other legislators agree to prospective expenditure reductions.

As such, the intermittent deliberations on Capitol Hill are fraught with tension.

Biden urged Republicans to shift from their rigid position during a press briefing before his departure from the Group of Seven Summit in Japan. After talks hit a standstill on Saturday, he expressed plans to get in touch with McCarthy during his journey back to Washington. McCarthy, in response, expressed his appreciation for the President's return and called for compromise from both sides.

Treasury Secretary Janet Yellen emphasized the dire necessity of making difficult decisions about unpaid bills should the debt ceiling remain unlifted. She reiterated her cautionary statement about a potential debt default by the United States as early as June 1, which could trigger a nationwide economic catastrophe.

During the Independent Community Bankers of America Capital Summit, Yellen presented findings from the White House Council of Economic Advisers indicating that a default could result in a severe economic decline akin to the Great Recession. In this scenario, millions of Americans could lose their jobs, and the stock market could lose nearly half of its value. Biden concluded by expressing cautious optimism about reaching a deal with the Republicans, albeit with an air of uncertainty.

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