The countdown continues. By Aug. 2–the deadline for raising the debt ceiling, which now stands at $14.3 trillion–the nation will likely find out if the United States will assume the role of deadbeat nation for defaulting on its obligations or whether ratings agencies like Moody's and S&P will downgrade government debt. Where the country currently stands right now: Congress has yet to agree on a proposal. In fact, Republican House Speaker John Boehner (R-Ohio) had to dramatically modify his deficit-reduction plan so he could gain enough votes in the GOP-controlled House. Despite all the political wrangling, it will be dead on arrival in the U.S. Senate. And Democrat Senate Majority Leader Harry Reid's proposal will face a similar fate in the House. There's not even a hint whether President Obama, who once again told the nation to pressure their congressional representatives to find "common ground" Friday morning, will invoke the 14th amendment as a resolution. At this point, Treasury has been reviewing contingency plans for paying bills. Uncertainty has caused the markets to get the jitters. For example, the Dow Jones Industrial Average has fallen five straight days, down more than 484 points, or 3.8%. Investors pulled an estimated $26 billion out of money market funds in the past two weeks, putting a crimp on short-term lending, according to the Investment Company Institute. And consumer confidence has ebbed to the lowest level since the Great Recession which presents severe implications for businesses, large and small. To lend further analysis to this situation, BLACK ENTERPRISE has reached out to policy analysts, government officials and money managers. Here is their take on future prospects: Continue reading on the next page... Prepare for a crisis similar to 2008. Gina E. Wood, Director of Policy and Planning for Washington, D.C.-based Joint Center for Political and Economic Studies, maintains that "the problem with [Congress playing] these kinds of games of chicken is that sometimes they end in a bad crash even that is not what either side is planning. What happens next is scary and unknowable but will be bad for the economy." Her view of the potential impact on consumers and entrepreneurs: If there is a default, there will be considerable financial market uncertainty, higher interest rates and possibly a repeat of the fears of financial crisis and economic collapse that motivated passage of TARP in late 2008. That's bad for everyone. Even if things get resolved pretty quickly, evidence suggest that interest rates will remain somewhat higher than they would have been without a default adding additional headwinds to the economic recovery. A weaker economy and continued high joblessness will aggravate the problems that make it so hard for the typical African American household to accumulate much if any non-housing wealth and will make it harder to become or remain a homeowner. Continue reading on next page... Brace yourself for higher borrowing costs. Assistant Labor Secretary William Spriggs believes "Congress will provide a resolution the President can sign" but stresses that the "needless haggling and political posturing by the House GOP on the full faith and credit of the United States does not help the image of the United States." The former member of the BE Board of Economists, however, offered the following thoughts on fallout in the event of default or downgrade: The impact will be catastrophic, because demand for the dollar is supported by demand for US Treasury notes–held by the world as the current "gold†standard because they are viewed as solid investments the world over. So, not only will the cost of borrowing go up for everyone in the US, the price of everything will go up as the value of the dollar falls. Continue reading on the next page... Save for the future: Although Paul Williams, president of the New York State Dormitory Authority, one of the nation's leading public finance and construction management agencies, "90% confident the US will not technically default. However, it appears more likely that we will be victimized by a ratings downgrade." His take: "I think all of the elected [officials] in Washington, from the president down, should be monumentally ashamed for being part of a ratings downgrade for the US. This will trickle down to consumers in a number of ways, from higher credit card and car loan interest,  to even lower housing prices as mortgage rates tick up. Also, values in 401ks and other savings products may take a nose dive as US credits face lower ratings [including muni bonds]. With this recent report indicating Black wealth at only one-twentieth of White wealth per household due to the impact of the last recession, this will be a double whammy at the most vulnerable time for Black families. I am afraid that these numbers tell a frightening story for the future. Black ownership will be limited and reduced, which will have the effect of marginalizing us in the economy. I have stressed to my kids the importance of savings, even from the first dollar earned. [We must save] for the future..if we hope to counteract some of the negatives on the horizon. Continue reading on the next page... Look for investment opportunities. Jason Tyler, senior vice president of research operations of Ariel Investments (No. 6 on the BE ASSET MANAGERS list with $5.5 billion in assets under management), believes default is unlikely and maintains that U.S. government debt remains attractive "because we're seen as such a safe haven. If the Euro wasn't suffering so much because of Greece and Italy, I think people would be flocking to the Euro. Luckily, the political turmoil in Europe is helping mask some of the longer-term issues here." Here's his commentary: We're prepared to look for [investment] opportunities if the market over-reacts. We're thinking about companies that might get hit hard. Clearly the companies that everybody's watching carefully are the SIFIs, the systemically important financial institutions [that] carry a lot of U.S. debt on balance sheets and have to maintain very, very vigorous capital requirements and if the U.S. Treasuries get downgraded, you could see some risks to some of those large financial institutions. Selling a lot of stock at this point is not a good idea. The market is very good at assessing risks, especially in the short run. So everybody's thought through which stocks are going to suffer and those types have all ready been hurt. The market has slipped down a little bit so these things are mostly factored in. [Also], U.S. Treasuries are and should continue to be seen as the safest place to park money. This is still a $13 plus trillion-dollar economy. It still dwarfs everything else in the world. It's still stable but the political environment is volatile right now. Continue reading on the next page... Develop a long-term financial plan. Isaac H. Green, who runs Durham, North Carolina-based Piedmont Investment Advisors L.L.C. (No. 8 on the BE ASSET MANAGERS list with $3.4 billion in assets under management) also believes that the United States will not default on its obligations and if its credit rating is downgraded then "meaningful budgetary reform takes place along with a structured approach to long-term deficit reduction, the AAA rating can be restored." He maintains African Americans can actually make positive gains by expanding income streams and maximizing their savings and investments over the long haul: A downgrade would likely have a muted impact.  There is already complete transparency with regard to the financial condition of the United States and a change in credit rating does not change this condition. The initial impact of higher rates would depress the value of most real and financial assets. Over time, it could serve to reduce the wealth gap because those who have less will likely lose less especially if financial assets are impacted more than real assets as seems likely to us and [secondly,] a higher interest rate environment will likely yield more attractive returns over time if African Americans can continue to close the income gap and also reduce the savings gap then this community's ability to build wealth may be enhanced.