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The first debt ceiling crisis

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  • Kenneth D. Garbade

Abstract

In the second half of 1953 the United States, for the first time, risked exceeding the statutory limit on Treasury debt. This paper describes how Congress, the White House, and Treasury officials dealt with the looming crisis?by deferring and reducing expenditures, monetizing ?free? gold that remained from the devaluation of the dollar in 1934, and, ultimately, raising the debt ceiling.

Suggested Citation

  • Kenneth D. Garbade, 2016. "The first debt ceiling crisis," Staff Reports 783, Federal Reserve Bank of New York.
    • Handle: RePEc:fip:fednsr:783
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    References listed on IDEAS

    as
    1. Garbade, Kenneth D., 2012. "Birth of a Market: The U.S. Treasury Securities Market from the Great War to the Great Depression," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262016370, December.
    2. Schwartz, Anna J, 1997. "From Obscurity to Notoriety: A Biography of the Exchange Stabilization Fund," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 29(2), pages 135-153, May.
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    More about this item

    Keywords

    U.S. Treasury; monetization of gold; debt ceiling;
    All these keywords.

    JEL classification:

    • N22 - Economic History - - Financial Markets and Institutions - - - U.S.; Canada: 1913-
    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt

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