That means contributions to 401(k)s and other retirement plans, as well as itemized deductions for charitable giving, mortgage interest and state and local taxes would be hit by the 28% limit and municipal bond interest would only be exempt at the 28% rate.

FORBES: Obama Budget Aims To Raise $580 Billion In New Taxes From Old Ideas Targeting Rich

Relying on the bond trustee to decide when to declare a default is a hit or miss exercise since the trustee is under the direction of the current bondholders and the bond indenture, both of who may limit his actions in this regard.

FORBES: Even If A Bond Doesn't Default, You Can Still Lose Your Money

The bond markets assume that the debt-ceiling limit will be raised.

FORBES: The Debt-Ceiling Panic Button Won't Be Pushed On Aug. 2

Issuers and bond underwriters, as well as many bondholders want to limit the calling of a default to a failure to make interest or principal payments to bondholders when they are due.

FORBES: Even If A Bond Doesn't Default, You Can Still Lose Your Money

Although the Fed is trying to limit the surprise of an end to its bond-buying program, there is a more likely event that officials will have to increase it to support a weakening economy, Nichols added.

FORBES: Gold Prices To Suffer As Fed Talks Exit Strategy

It is this commitment to intervene without limit that has cowed speculators hoping to profit from bond-market distress.

ECONOMIST: Has Mario Draghi done what it takes to save the euro?

Bond prices should remain stable, though volatile so long as there is political fighting about the debt limit.

FORBES: What a US Default, Downgrade Might Look Like