Resolves NO if before June 1 (Eastern time), the US raises or suspends the debt ceiling.
Resolves NO if the US defaults on its debt in 2023.
Resolves YES if the US neither raises the debt ceiling nor defaults.
This question is intended to help answer: "If the US fails to raise the debt ceiling before June 1, how likely is default?". See also https://manifold.markets/SimonGrayson/will-the-us-debt-ceiling-be-raised-4dfbab873f7b#NCK95nCmDyevr09h9JvA
Definitions:
Raising or suspending the debt ceiling is defined the same as https://manifold.markets/jack/will-the-us-debt-ceiling-be-raised
Default is defined the same as https://manifold.markets/jack/will-the-us-government-default-on-i
@AlexbGoode I'm going to at least wait until next week when the treasury starts issuing new bonds. Even then, it could still resolve yes because the US could default for some unanticipated reason, but because this is very unlikely I think it's sensible to resolve NO now and reresolve in the very unlikely case that happens.
@jack I misunderstood the criteria. Thanks for clarifying
@jack Why now ignore the second clause? Wasn’t that the whole point this was trying to measure? If resolves as soon as failed to raise ceiling before June 1, then it was just a duplicate of so many others.
Unless I'm missing something, the value of this market and the market below shouldn't add up to more than 100%.
This market is for a scenario where the debt ceiling is not raised by the end of May and there's no default. The market below is for a scenario where the debt ceiling is raised. So they can't both resolve to YES.
I've bet NO a bit on both markets as an arbitrage bet, but if this market is meant to be able to act as a predictor of whether or not the US will default if the debt ceiling isn't raised in the next week then they should below 100% in total (with the gap being the chance of no raise and a default).
I'm mentioning all of this in the hope that the market can start to predict this useful info a bit more!
@SimonGrayson That's correct, the two are mutually exclusive.
They are getting slightly out of wack because this one is new and the liquidity is still very low.
This would be a great market, but with the real definition of default (failure to make debt/bond payment)
@GaryGrenda I think the US failing to pay non-bond government obligations would be pretty bad for the economy as well.
@jack So do I. It's just not a default. And they would get paid almost certainly, just delayed.
@GaryGrenda I did some searching to find what is the usual definition of default. While I think bond repayments are the thing people are most likely to think of, it seems clear to me that other failures to repay non-debt obligations are generally considered default too.
financial default can occur whenever a company fails to meet any kind of financial obligation.
Missed payments for supplies, raw materials, royalties, and similar unsecured operating liabilities.
https://www.investopedia.com/terms/d/default2.asp
This article mostly says that default is failure to make required repayments on debt, but it also gives a differing example:
Defaulting on a futures contract occurs when one party does not fulfill the obligations set forth by the agreement. Defaulting here usually involves the failure to settle the contract by the required date.
And as a specific example of a non-debt obligation that we individuals can more easily relate to, consider rent. Failure to pay rent on time is called default. https://www.lawinsider.com/dictionary/rent-default
Actually let me copy this to https://manifold.markets/jack/will-the-us-government-default-on-i since that market is more directly about the definition of default, and we can continue discussing there.
