Default

Technically the US has defaulted before...on accident, and it wasn't pretty:

Terry Zivney and Richard Marcus describe the default in The Financial Review (sorry, I can’t find an ungated version):

Investors in T-bills maturing April 26, 1979 were told that the U.S. Treasury could not make its payments on maturing securities to individual investors. The Treasury was also late in redeeming T-bills which become due on May 3 and May 10, 1979. The Treasury blamed this delay on an unprecedented volume of participation by small investors, on failure of Congress to act in a timely fashion on the debt ceiling legislation in April, and on an unanticipated failure of word processing equipment used to prepare check schedules.

Obamacare

GOPers are afraid of Obamacare, but this is the scariest graph:

Paul Ryan's "solution" was to refuse to let it grow, as if this could be stopped through sheer force of will.

Shut Down.

Estimates of the consequences of the shut down. Also checkout MacroAdvisors shutdown calculator and run your own estimates.

Germany the Currency Manipulator

Paul Krugman points out that even within the most extreme version of a fixed exchange rate regime - a currency union - one can think about the misalignment of the underlying currencies (even if their are no underlying currencies).

The general point is that if we imagine a euro breakup, I think everyone would agree that the new mark would soar in value, making German manufacturing much less competitive. The German public imagines that it is being cruelly exploited for the benefit of lazy southerners; arguably, what’s really happening is more like China’s purchases of dollars, which are intended not to subsidize America but to boost industry.

Shutdown

What to expect Day 1. 10 ways it could affect you. Why it happened. And the bigger looming problem of the debt ceiling.