debt ceiling no pay

Will the Debt Ceiling be Good for Gold and Silver?

Investors preparing for Washington's budget battle need to know: Will the debt ceiling be good for gold and silver?

Thanks to recent legislation passed in the U.S. House of Representatives Wednesday, the debt ceiling could be extended until May 19. The bill now moves onto the Senate where it is expected to get the green light, then should be signed quickly by U.S. President Barack Obama.

That gives investors time to prepare for what any budget decision - or indecision - out of Washington will do for their investments.

While the bill leaves the government without a long-term budget strategy, investors ought to have a plan in place.

One thing they can plan on is higher silver and gold, and here's why.

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Debt Ceiling Bill Includes Controversial "No Pay" Plan

Republicans will vote tomorrow (Wednesday) on a debt ceiling bill that will give Congress nearly four months to make some major budget decisions - or risk losing out on pay.

The bill aims "to ensure complete and timely payment of the obligations of the United States Government until May 19, 2013," according to a release Monday from the House Rules Committee. Exactly how much the $16.4 trillion debt ceiling will be lifted hasn't been discussed.

In a significant shift in GOP strategy, the legislation does not include specific spending cuts, like previously when Republicans have requested dollar-for-dollar cuts to match the debt ceiling increase.

What it could include is a requirement for both the House and Senate to pass a budget by as early as April 15 or have Congress members' salaries held in escrow until one is passed - what the GOP has coined a "no budget, no pay" rule.

"[I]f the Senate of House fails to pass a budget in that time, members of Congress will not be paid by the American people for failing to do their job. No budget, no pay," House Majority Leader Eric Cantor, R-VA, said last week.

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