The United States Will Never Default on Its Obligations

"The United States will never default on its obligations," Treasury Secretary Timothy Geithner said on Wednesday morning. According to

, at Politico's "Playbook Breakfast" Geithner tackled the topic of the debt ceiling, stating that he was fully confident that not only would congress raise the debt ceiling by the end of the summer, but lawmakers would also establish a reform system to deal with the nation's long-term debt obligations. He downplayed the ongoing debate regarding the debt ceiling, characterizing it as "theater." Is Geithner being overly optimistic, or are his predictions likely to prove true? Whether or not Geithner is correct, the issue of the debt ceiling may have a tremendous affect on the value of the dollar. Should Geithner's predictions be validated, the dollar may strengthen. The dollar has been weakening in recent months as concerns over the long term solvency of the U.S. government may have crept into investors' minds. Investors considering playing a stronger dollar may wish to consider PowerShares DB US Dollar Bullish Index

. On the other hand, if the debt ceiling is raised, but Congress fails to enact true debt reforms, it may be bearish for the dollar. In that case, investors may wish to look at PowerShares DB US Dollar Bearish Index

. The issue of the debt ceiling is perhaps the most pressing medium-term catalyst on the U.S. dollar's value. Even if investors are fleeing the euro because of Greek concerns, the dollar may not do well if the federal government is forced to default.