Hitting Debt Ceiling Could Erase Two Years Of 401(k) Gains

Center for American Progress Senior Economist Heather Boushey, testifying before the Congressional Democratic Policy and Steering Committee today, pointed out that “reaching the debt ceiling will, in all likelihood, trigger a sharp fall in the stock market…The drop in stock prices will have an immediate effect on the economy, but also on families. Families with 401(k)s would likely lose all the gains they have made in 2010 and much of their gains in 2009, moving them further below where they were at the end of 2007 after the stock market fell sharply.”