What happens if lawmakers do not act to raise the statutory debt limit?

I keep seeing articles about Janet Yellen sending letters to the congress encouraging them to raise the debt limit. Based on my understanding she has said “Failure to meet the government’s obligations would cause irreparable harm to the U.S. economy, the livelihoods of all Americans and global financial stability,”

It also sounds like Biden may hold the line and not agree to a debt ceiling limit raise with strings attached.

So what happens to markets if no decision is reached?