‘Nobody knows when it’s going to happen’: Wall Street wakes up to default threat.

For months, Wall Street has barely focused on the possibility that the government might default on its debt. It’s paying attention now.

As the drop-dead date to raise the nation’s $31.4 trillion debt ceiling looms with no deal in sight, traders and executives are starting to get nervous that President Joe Biden and Republicans won’t resolve the impasse until it’s too late. That’s sparked increasing concern about a potential threat that could rock markets and tilt the world’s largest economy into recession.

“There is this view in D.C. that the...