By Peter Schroeder - 07/28/11 02:39 PM EDT
A group of top financial executives is pressuring policymakers to strike a deal on the debt limit, warning that inaction would yield "very grave" consequences.
Top Wall Street executives such as Bank of America's Brian Moynihan, Goldman Sach's Lloyd Blankfein and JPMorgan Chase's Jamie Dimon signed on to a letter sent to the president and members of Congress on Thursday. The letter was officially sent by the Financial Services Forum, a nonpartisan group that represents the chief executive officers of the largest financial firms.
"A default on our nation’s obligations, or a downgrade of America’s credit rating, would be a tremendous blow to business and investor confidence — raising interest rates for everyone who borrows, undermining the value of the dollar and roiling stock and bond markets — and, therefore, dramatically worsening our nation’s already difficult economic circumstances," they wrote. "Given this very real risk, policymakers must correct our fiscal course now, inspire market confidence by paying all of our bills on time, and demonstrate that America is a democracy capable of putting differences aside to solve our most challenging problems."
They called for a "credible and predictable" plan to deal with the nation's debt involving "tough decisions on the budget."
The letter from Wall Street's most visible leaders comes as the House prepares to vote Thursday evening on the plan put forward by House Speaker John Boehner (R-Ohio).
Meanwhile, Senate Majority Leader Harry Reid (D-Nev.) is touting his own plan, and claims to have enough Democratic support in his chamber to shoot down Boehner's.
The Treasury Department has been adamant in demanding a debt limit increase by Aug. 2, warning it will not be able to meet all its obligations after that date without more borrowing.