I've been keeping half an eye on the incredible hypocrisy and mendacity that is the debt ceiling increase discussion. The question is, is it a cause for panic if the increase somehow doesn't happen?
David Brin, an excellent sci-fi author, doesn't think so. However, I think he doesn't really appreciate how it will hit the banking system. Also, there's the question of the paper market. If a fiat currency is called into question for legitimacy, it could actually cause the collapse of the entire economy. No, I don't think that'll happen, but I also don't think it's beyond the realm of possibility.
But we should really take a look at what it might mean to the banking system. If your collateral (a T-bill) doesn't pay out, are you still solvent? It's possible that you are not. If that happens, all hell could truly break loose.
Hopefully, the Republican intransigents are aware of this, and can find a way to back away from weakening "the full faith and credit of the United States". Because, that way, madness could truly lie.
It'd be really nice if everyone involved could constrain themselves to arguments that are actually rooted in facts. And not ignore the inconvenience that many of those complaining about the raise (actually, all of them who've been in Congress for more than four years) are the ones who repeatedly voted to raise the ceiling under W. Seven times, actually.