Obama administration officials have been privately exploring with major banks and foreign investors whether the government could devise a way to avoid a severe disruption in financial markets if the federal debt ceiling is not raised, according to several people familiar with the matter.

Officials have discussed suspending some domestic spending in order to make payments to investors in U.S. bonds — which include domestic pension funds and the Chinese government — and possibly selling assets such as gold.

But the message back from the market has been discouraging: The failure to pay any significant obligations would scare away investors and undermine the financial system…

Still, the expectations of a default in the next year, as measured by “credit default swaps,” remained low, at a 1-in-2,000 chance, according to Dow Jones Newswires. That compares with 1-in-5 odds that Greece, already in the throes of a massive debt crisis, will default.