{"id":2009015,"date":"2023-08-23T07:24:01","date_gmt":"2023-08-23T11:24:01","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/heightened-risk-of-government-shutdown-goldman-sachs\/"},"modified":"2023-08-23T07:27:34","modified_gmt":"2023-08-23T11:27:34","slug":"heightened-risk-of-government-shutdown-goldman-sachs","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/heightened-risk-of-government-shutdown-goldman-sachs\/","title":{"rendered":"Increased risk of government shutdown: Goldman Sachs"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">14<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fheightened-risk-of-government-shutdown-goldman-sachs%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=2009015&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><div data-post-content=\"true\" class=\"post_content\" id=\"post_content\">\n<p>Goldman Sachs recently predicted that a U.S. government shutdown was more than\u2062 likely this year, in a <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/unicef-children-will-need-almost-a-decade-to-recover-from-lockdowns\/\" title=\"UNICEF: Children Will Need Almost a Decade to Recover from Lockdowns\">recently published report<\/a>.<\/p>\n<p>The international lender said \u200bthat the GOP House majority, a Democrat-controlled\u200d Senate, and a lack of agreement \u200don key spending \u200cissues, \u200dheightened the risk.<\/p>\n<blockquote><p>\u201cThe ingredients\u2064 for\u200c a shutdown\u2014a thin House majority, a dispute on spending levels, \u2064and potential complications \u2063from\u200c various political issues\u2014are present,\u201d wrote Goldman Sachs economists on Aug.\u2062 20.<\/p><\/blockquote>\n<div class=\"shortcode\">\n<div class=\"border-comp-divider mb-4 mr-4 w-full max-w-[500px] border px-5 py-4 text-[16px] leading-[20px] text-[#262626] md:float-left\">\n<div class=\"mb-3 font-sans text-[16px] font-semibold uppercase leading-[19px] text-[#2F2F2F]\">Related Stories<\/div>\n<div class=\"mb-4 flex gap-2\">\n<div class=\"grow\">\n<div class=\"mb-1 line-clamp-2\"><a href=\"http:\/\/www.theepochtimes.com\/us\/congressman-wants-to-cut-lawmakers-pay-in-event-of-shutdown-5434451\">Congressman Wants to Cut Lawmakers&#8217; Pay in Event of Shutdown<\/a><\/div>\n<div class=\"text-comp-caption text-[14px] leading-[18px]\">7\/31\/2023<\/div>\n<\/p><\/div>\n<div class=\"shrink-0 basis-[120px]\"><a href=\"http:\/\/www.theepochtimes.com\/us\/congressman-wants-to-cut-lawmakers-pay-in-event-of-shutdown-5434451\"><\/a><\/div>\n<\/p><\/div>\n<div class=\"mb-4 flex gap-2\">\n<div class=\"grow\">\n<div class=\"mb-1 line-clamp-2\"><a href=\"http:\/\/www.theepochtimes.com\/us\/house-freedom-caucus-vows-spending-fight-unafraid-of-government-shutdown-5421142\">House Freedom Caucus Vows Spending Fight, Unafraid of Government Shutdown<\/a><\/div>\n<div class=\"text-comp-caption text-[14px] leading-[18px]\">7\/25\/2023<\/div>\n<\/p><\/div>\n<div class=\"shrink-0 basis-[120px]\"><a href=\"http:\/\/www.theepochtimes.com\/us\/house-freedom-caucus-vows-spending-fight-unafraid-of-government-shutdown-5421142\"><\/a><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>In reference to\u200c Fitch&#8217;s downgrade of the United States&#8217; credit rating, they wrote,\u2063 \u201cthe spotlight\u200c that the recent sovereign downgrade shines on the fiscal situation adds to the risks.&#8221;<\/p>\n<p>On the other\u2062 hand, the report pointed\u2062 out that\u200c the economic consequences of Congress\u2063 failing to pass a budget before the end of the fiscal year on Sept. 30, would be manageable and that markets have not responded strongly to past government shutdowns.<\/p>\n<p>Goldman believes that the economic consequences would be less severe, compared to if there was no agreement to suspend the debt limit by the end of May.<\/p>\n<div class=\"shortcode\">\n<div class=\"lazyload-wrapper\">\n<div class=\"lazyload-placeholder\"><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<h2>Wall\u2062 Street Not Too Worried Over Potential \u200bShutdown<\/h2>\n<p>The government last shut down during the winter of 2018 to 2019, but many investors are not \u200btoo worried about one this time.<\/p>\n<p>At the end of each previous shutdown, Wall Street historically has been flat\u200c or higher than at the start \u2063of the\u2063 shutdown.<\/p>\n<p>Although a government shutdown \u200dcould cause financial \u200dstress for certain \u200dindividuals, such as government workers, it would not \u2062cause much damage \u200cto the wider\u200b American economy, especially compared to the greater threat of the\u2063 previous debt default.<\/p>\n<p>\u201cUnlike the debt limit, where Congress reached a deal because the potential\u200b hit to the economy from \u2064an impasse would have been so severe, a shutdown\u2063 would be much more manageable from a \u2063macroeconomic perspective,\u201d said the report.<\/p>\n<p>&#8220;However, compared to the debt limit, the \u2064less severe economic effect of a shutdown also makes it\u2064 more likely that Congress\u2062 fails to act in \u200dtime,&#8221; it said.<\/p>\n<p>During a government shutdown, federal authorities will continue to pay benefits like Social Security, along with interest and principal on U.S. debt.<\/p>\n<p>\u201cThe differences between a shutdown and the \u200bdebt limit that make a shutdown much less damaging also make it more likely to occur,\u201d they wrote.<\/p>\n<p>The team added that a less severe impact on\u2062 the economy was not a \u201cforegone \u200bconclusion\u201d and that the timing was \u200duncertain.<\/p>\n<h2>House \u2062Republicans Argue Over Budget Stop Gap \u2064Measure<\/h2>\n<p>Less severe economic predictions could actually increase the likelihood of a shutdown, by encouraging political struggles over spending.<\/p>\n<p>The apparently milder consequences\u200d of a shutdown may also remove pressure on Washington to\u200d reach a compromise on certain decisions, said the analysts.<\/p>\n<p>The Fiscal Responsibility Act, which \u200dsuspended\u200d the debt ceiling in exchange for some spending caps and other \u200bprovisions demanded by House Republicans,\u200b \u201cshould have ended the\u200b debate on spending levels,\u201d \u2063said the report.<\/p>\n<p>Conservatives in the House are currently\u200d opposing the length of a short-term budget fix being pushed by House Speaker \u2064Kevin McCarthy (R-Calif.) and are pushing for additional cuts.<\/p>\n<p>\u201cWe refuse to support\u200d any such measure that continues Democrats\u2019 bloated COVID-era spending and simultaneously fails to force the Biden Administration \u200bto follow the \u200claw and fulfill its\u2062 most basic responsibilities,\u201d said the Freedom Caucus, in a <a href=\"https:\/\/twitter.com\/freedomcaucus\/status\/1693624211695079521\" target=\"_blank\" rel=\"noopener\">post<\/a> on X, previously \u200dknown as Twitter.<\/p>\n<p>They stated\u2064 that any <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/congress-adds-more-items-to-an-already-jam-packed-september\/\" title=\"Congress Adds More Items To An Already Jam-Packed September\">short-term bill<\/a> that continued funding at current levels was something they \u201cvehemently opposed\u201d months ago.<\/p>\n<p>Speaker McCarthy argued that he wants it passed to buy time\u200d to avert a shutdown, but many in his party are comfortable with the idea of a shutdown if it leads to reduced spending and a lowering of the national debt.<\/p>\n<p>\u201cHouse Speaker Kevin McCarthy gets credit for \u200dkeeping his troops in line, but his good fortune may end soon,\u201d Greg Valliere, Chief U.S. Policy\u200b Strategist at AGF Investment, said earlier this month and put the chance of a \u2062government \u200dshutdown by December at 60 percent.<\/p>\n<p>Goldman listed several policy conflicts with the Biden administration, which are\u2062 likely to make it even more difficult to pass a spending \u2063bill by the<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Goldman Sachs predicts a probable U.S. government shutdown this year due to a slim House majority, a Democrat-controlled Senate, and disagreements on spending. The international lender highlights the risk of a shutdown in a recent report.<\/p>\n","protected":false},"author":327,"featured_media":2009016,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[543],"tags":[],"class_list":["post-2009015","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-epoch-times"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2009015","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/327"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=2009015"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2009015\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2009016"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=2009015"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=2009015"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=2009015"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}