The U.S. economy would contract by 5% and stocks would fall by nearly a third in the "very...

|By:, SA News Editor

The U.S. economy would contract by 5% and stocks would fall by nearly a third in the "very unlikely" event of a default, Credit Suisse forecasts, but the more likely outcome of no default combined with no budget deal would cause equity markets to drop 10-15%. The 50-50 chance of a ratings downgrade of U.S. debt would have little effect, the firm says.