{"id":2041370,"date":"2023-09-22T12:09:02","date_gmt":"2023-09-22T16:09:02","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/analysis-potential-us-government-shutdown-could-dent-investor-confidence\/"},"modified":"2023-09-22T12:13:19","modified_gmt":"2023-09-22T16:13:19","slug":"analysis-potential-us-government-shutdown-could-dent-investor-confidence","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/analysis-potential-us-government-shutdown-could-dent-investor-confidence\/","title":{"rendered":"US government shutdown may harm investor confidence."},"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%2Fanalysis-potential-us-government-shutdown-could-dent-investor-confidence%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=2041370&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--><p><!DOCTYPE html PUBLIC \"-\/\/W3C\/\/DTD HTML 4.0 Transitional\/\/EN\" \"http:\/\/www.w3.org\/TR\/REC-html40\/loose.dtd\"><br \/>\n<?xml encoding=\"utf-8\" ?><?xml encoding=\"utf-8\" ?><?xml encoding=\"utf-8\" ?><html><body><\/p>\n<div class=\"entry-content\">\n<h2>Government Shutdown\u200c Could Impact Economy, Investors Warn<\/h2>\n<p>By David\u2062 Randall<\/p>\n<p>NEW YORK\u200d (Reuters) \u2013 A potential\u200b U.S. government shutdown at the end of September could add to worries about \u2062the economy going into year-end and beyond, investors \u2062said. \u2064 <\/p>\n<div id=\"div-gpt-ad-1663871513696-art-1\" style=\"min-width: 320px; min-height: 50px;  text-align: center;\">  \t<script>  \t\tgoogletag.cmd.push(function() { googletag.display('div-gpt-ad-1663871513696-art-1'); });  \t<\/script>  <\/div>\n<div class=\"ad-slot__ad-label\">Advertisement<\/div>\n<\/p>\n<p>Current funding for most government programs expires on Sept. 30. If \u2062lawmakers are unable to pass a new budget by then, large swathes of government\u2062 functions would shut down, an event strategists at Goldman Sachs estimate would reduce U.S. economic \u200cgrowth \u2064by\u200d 0.2% \u2064for each week it lasted.<\/p>\n<p>A partial closure of the government, which will not interfere with essential functions like the \u200bmilitary or Social Security payments, is not \u2063seen to \u2063be as toxic\u2063 to\u2063 the economy as a failure to increase \u200dthe government\u2019s debt\u200d limit, an \u200d<a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/analysis-potential-us-government-shutdown-could-dent-investor-confidence\/\" title=\"US government shutdown may harm investor confidence.\">outcome \u200clawmakers narrowly avoided \u200dearlier<\/a> this year. <\/p>\n<p>Past shutdowns\u2019 impact on U.S. stocks, \u2064meanwhile, has been slight: the \u200bS&#038;P 500\u200c has fallen by\u200c an average of 0.4% in the week\u2062 before a \u2064shutdown, and \u200bgained a total of 0.1% over the length of \u200ball shutdowns since 1976, according \u200dto CFRA Research data. <\/p>\n<p>Investors \u200dmight be more sensitive to a \u200cshutdown this time around, however. Failure to pass a budget would \u2064highlight\u200d the \u2063gridlock and political instability that\u200b ratings\u200c agency Fitch cited \u2062as a reason for its downgrade of the U.S. \u2062credit rating in August, \u200da move that roiled markets\u200c last \u200cmonth. <\/p>\n<p>At\u200b the \u2063same time, a shutdown \u200dcould lead\u2062 to spending cuts\u2063 that may dampen the economy at a time when \u200bother \u200bfactors, including the Federal Reserve\u2019s monetary policy tightening and\u200c the resumption of payments on student \u2062loans, loom as a threat \u200cto growth, analysts\u2063 said. <\/p>\n<p>Resilient growth in the face of higher \u2063interest rates has helped power the S&#038;P 500 to a nearly \u206216% gain this year, though the \u2062index\u2063 is off some 4% from \u200cits July highs following a\u2064 surge in Treasury\u2064 yields that has spooked some investors. <\/p>\n<p>\u201cYou\u2019re\u2064 going to get some reduction in government spending because\u200b that\u2019s the only way that these bills will pass,\u201d said Jamie Cox,\u200b managing partner for Harris Financial Group, who is growing \u200cmore bullish on defensive sectors \u2064such\u2064 as healthcare. \u201cThat will create a meaningful slowing \u2064of\u2063 the economy.\u201d <\/p>\n<p>Hard-line Republicans in\u200b the House Freedom\u200b Caucus \u200chave insisted they will \u2062not support the \u2063spending bills necessary to fund the government for its next fiscal year without paring discretionary spending to $1.47 \u200btrillion, \u2064$120 billion \u2063below the\u200d level agreed \u2064to by House Republican Speaker \u2064Kevin McCarthy and President \u200cJoe Biden. <\/p>\n<p>Goldman Sachs estimates\u2063 that such \u200da reduction\u2062 would amount to a cut of 0.6% from \u2063the \u200dcurrent\u200d U.S. <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/its-official-trump-crushes-record-for-largest-gdp-increase-in-us-history-3rd-quarter-gdp-up-33-1\/\" title=\"IT'S OFFICIAL: Trump Crushes Record for Largest GDP Increase in US History -- 3rd Quarter GDP Up 33.1%\">gross domestic product<\/a>. <\/p>\n<p>With only weeks to go before the deadline, the Republican-led House of Representatives has approved only one of those 12 bills. Spending and\u200c tax measures normally originate in \u200dthe House before moving to the Senate.<\/p>\n<p>\u2018LESS FRIENDLY POLICY\u2019 <\/p>\n<p>If it\u200d occurs, the shutdown would be the fourth over the last \u200cdecade and would furlough roughly\u200b three of out five federal \u200ccivilian\u200c workers. The \u2064government would continue making payments on Treasury\u200b bonds.<\/p>\n<p>Past shutdowns have\u2063 usually\u2064 been \u2062resolved \u200din\u2063 days, though a\u2062 2018 closure ran for \u200d35 days and\u200d shaved 0.1% \u2064and 0.2% from real gross domestic\u200d product\u2063 in the fourth quarter of 2018 and\u2062 the first quarter of 2019, respectively, according to the Congressional Budget Office.<\/p>\n<p>Paul Christopher, head of <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wall-street-holds-gains-ahead-of-earnings-jobs-data\/\" title=\"Wall Street maintains gains before earnings, jobs data.\">global investment strategy<\/a> for Wells Fargo Investment Institute, believes any shutdown would likely be protracted\u200d as \u2064Republicans\u2064 and Democrats begin positioning themselves for the presidential and congressional elections next year. <\/p>\n<p>A deal that does not cut into \u2062the\u2063 U.S. budget deficit may push yields \u200don government debt higher, potentially extending \u2062a move that\u200d has wobbled \u200cstocks in recent weeks, said Christopher.<\/p>\n<p>He is moving into areas of the market \u2063such as materials and industrials, believing high-flying\u2062 sectors \u2064like tech are\u2062 \u201coverdue\u201d\u2064 for\u2062 a correction.<\/p>\n<p>The\u200d White House last \u200bmonth said it was working with Congress to hammer \u200cout a short-term funding\u2064 measure to avoid a shutdown while longer-term spending\u2064 talks continue.<\/p>\n<p>Analysts at Ned Davis Research said a shutdown could add to factors threatening\u2062 to roil the\u200d economy into\u200c next year. <\/p>\n<p>\u201cThe potential for higher-for-longer\u2063 monetary policy, the \u2063restart of student loan payments, a government shutdown, and lower \u2063(cost of living) adjustments in 2024 could combine for\u200c less friendly \u2062policy for financial markets,\u201d \u200cthey wrote.<\/p>\n<p>The following table shows how the \u2064S&#038;P 500 moved around each of \u200cthe 20 government shutdowns since 1976, according to data compiled \u200dby CFRA Research.<\/p>\n<blockquote>\n<h3>S&#038;P 500 Performance During Government Shutdowns<\/h3>\n<ul>\n<li>9\/30\/1976 &#8211; \u206310\/11\/1976: -1.4% before, -0.1% \u200con day,\u200c -3.5% total<\/li>\n<li>9\/30\/1977 &#8211; 10\/13\/1977: 0.9% before, \u200d0.7% on day, -2.5% total<\/li>\n<li>10\/31\/1977\u2064 &#8211; 11\/9\/1977: 1.1% before, -0.3% on day, \u20640.4% total<\/li>\n<li>11\/30\/1977 &#8211; 12\/9\/1977: -2.0% before, 0.3% on\u2062 day, \u200d-1.0% total<\/li>\n<li>9\/30\/1978 &#8211; \u200b10\/18\/1978: 0.7% before, 0.4%\u2063 on day,\u2064 -2.0% \u200dtotal<\/li>\n<li>9\/30\/1979 &#8211; 10\/12\/1979: -0.2% before, -1.5%\u200d on day, -5.2% total<\/li>\n<li>11\/20\/1981 &#8211; \u200c11\/23\/1981: -0.8% before, 0.8% on day, 0.7% total<\/li>\n<li>9\/30\/1982\u2062 &#8211; 10\/2\/1982: -1.8% before, 0.3% on\u2062 day,\u200c -0.1% total<\/li>\n<li>12\/17\/1982 \u2064- 12\/21\/1982: \u200d-3.1% before, \u200d1.6% on \u200bday,\u200d 2.4% \u2064total<\/li>\n<li>11\/10\/1983 \u2063- 11\/14\/1983: 0.3%\u2063 before, 0.3% on day, 1.6% total<\/li>\n<li>9\/30\/1984 -\u2062 10\/3\/1984: 0.3% before,\u2064 -0.9% on day, -2.2% total<\/li>\n<li>10\/3\/1984 &#8211; \u206210\/5\/1984: -1.6% before, -0.7% on day, -0.6% total<\/li>\n<li>10\/16\/1986 &#8211; 10\/18\/1986: 1.3%\u200c before, 0.3% on day, -1.2% total<\/li>\n<li>12\/18\/1987 -\u2063 12\/20\/1987: \u20643.3% before,\u200d 2.5% on day, 2.7% \u2063total<\/li>\n<li>10\/5\/1990 &#8211; 10\/9\/1990: 2.2% before, -0.4% on day, -2.4% total<\/li>\n<li>11\/13\/1995 &#8211; 11\/19\/1995: 0.7% before, -0.1% \u2064on day, \u200b0.7% total<\/li>\n<li>12\/15\/1995 &#8211; 1\/6\/1996: -0.1%\u200d before, -0.1% on day, 0.2% total<\/li>\n<li>10\/1\/2013 &#8211; 10\/16\/2013: -0.9% before, 0.8% on day, 2.4% \u2063total<\/li>\n<li>1\/19\/2018 &#8211; 1\/22\/2018: 0.4% before, \u200d0.4%\u2064 on\u200c day, 1.2% \u2064total<\/li>\n<li>12\/22\/2018 -\u2062 1\/26\/2019: -7.1% before, -2.7% on \u2064day, 9.4% total<\/li>\n<li>Averages: -0.4% before, 0.1% \u2063on day, 0.1% total<\/li>\n<\/ul>\n<\/blockquote>\n<p>(Reporting by David Randall. Editing by Ira Iosebashvili and Marguerita Choy)<\/p>\n<p><a href=\"https:\/\/www.oann.com\/uncategorized\/analysis-potential-us-government-shutdown\/attachment\/illustration-shows-u-s-dollar-banknotes-2\/\"><\/a><\/p>\n<\/p><\/div>\n<div class=\"entry-content\">\n<p>with Matt Marcenelle <\/p>\n<\/p><\/div>\n<div class=\"entry-content\">\n<p>with Aly Legge<\/p>\n<\/p><\/div>\n<div class=\"entry-content\">\n<p>with Dr. Pierre Kory<\/p>\n<\/p><\/div>\n<div class=\"entry-content\">\n<p>with Roman Balmakov<\/p>\n<\/p><\/div>\n<div class=\"entry-content\">\n<p>WASHINGTON (Reuters) \u200c\u2013\u200d The United\u200c States argued on Tuesday\u200d that Alphabet \u2063Inc\u2019s \u2063Google broke the law in its efforts to\u2064 dominate online\u2026 <\/p>\n<\/p><\/div>\n<div class=\"entry-content\">\n<p>By\u2064 John Revill ZURICH (Reuters) \u2013 ABB is spending $280 million on a new robotics factory in\u2064 Sweden, the Swiss engineering and\u2026 <\/p>\n<\/p><\/div>\n<div class=\"entry-content\">\n<p>PARIS (Reuters) \u2013 French Europe Minister Laurence Boon\u2062 on Wednesday welcomed an anti-subsidy investigation into Chinese electric vehicles launched by the EU\u2026 <\/p>\n<\/p><\/div>\n<div class=\"entry-content\">\n<p>By Mathieu Rosemain and Silvia Aloisi PARIS (Reuters) \u2013 Apple said on Wednesday \u2064its\u200c iPhone 12 model was certified by\u200b multiple international\u2026\u2062 <\/p>\n<\/p><\/div>\n<p> rnrn  <\/p>\n<h2> What potential effects could a government shutdown have on investor confidence and the stock market<\/h2>\n<p><span>  Government \u2064Shutdown Could Impact Economy, Investors \u2062Warn<\/p>\n<p>By David\u2062\u200c Randall<\/p>\n<p>NEW YORK\u200d (Reuters) \u2013 A potential\u200b U.S. government shutdown at the end of September could add \u200bto worries about \u2063\u2062the economy going into year-end and beyond, investors \u2064\u2062said. \u2064 Current funding for most government programs expires\u200b on Sept. 30. If \u2062lawmakers \u2062are unable to pass a new budget by then, large swathes of government\u2062 functions would shut down, an event strategists at Goldman Sachs estimate would reduce U.S. economic \u200cgrowth \u2064by\u200d\u2062 0.2% \u2064for each week\u200b it lasted.<\/p>\n<p>A partial closure of the \u2062government, which will not interfere with essential functions like the \u200bmilitary or Social Security payments, is not \u2063seen to\u200d \u2063be as toxic\u2063 to\u2063 the economy as a failure to increase \u200dthe government\u2019s debt\u200d limit, an \u200doutcome \u200clawmakers narrowly avoided \u200dearlier this year. <\/p>\n<p>Past\u200d shutdowns\u2019 impact on U.S. stocks, \u2064meanwhile, has been slight: \u200cthe \u200bS&#038;P 500\u200c has fallen by\u200c an average of 0.4% in the\u2064 week\u2062 before a \u2064shutdown, and \u200bgained a total of 0.1% over the\u200b length of \u200ball shutdowns since 1976, according \u200dto CFRA Research data. <\/p>\n<p>Investors \u200dmight be more sensitive \u2064to a \u200cshutdown\u200c this time around, however.\u200b Failure to pass \u200ca budget\u200c would \u2064highlight\u200d the \u2064\u2063gridlock\u2062 and political instability that\u200b ratings\u200c agency Fitch cited \u2062as a reason for its downgrade of the U.S. \u2062credit rating in August, \u200da move that roiled markets\u200c \u200dlast \u200cmonth. <\/p>\n<p>At\u200b the\u200b \u2063same \u200dtime, a shutdown \u200d\u200dcould lead\u2062 to spending\u200d cuts\u2063 \u200bthat may dampen the economy at a time when \u200bother \u200bfactors, including the Federal Reserve\u2019s monetary policy tightening and\u200c the resumption of payments on student \u2062loans, loom\u200b as\u2063 a threat \u200cto\u200c growth, analysts\u2063 said. <\/p>\n<p>Resilient growth in the face\u200c of higher \u2063interest rates has helped power the S&#038;P 500 to a nearly \u206216% gain this\u2063 year, though the \u2062\u2062index\u2063 is off some 4% from \u200cits July highs following\u2063 a\u2064 surge\u2063 in Treasury\u2064 yields that has spooked some investors. <\/p>\n<p>\u201cYou\u2019re\u2064 going to get some reduction in government spending because\u200b that\u2019s the only way that these bills will pass,\u201d said Jamie Cox,\u200b managing \u200cpartner for Harris Financial Group, who \u2063is\u2064 growing \u200d\u200cmore bullish on defensive sectors \u2064such\u2064\u200c as healthcare. \u201cThat will create a meaningful slowing \u2064of\u2063 the economy.\u201d<\/p>\n<p>Hard-line Republicans\u2064 in\u200b the \u2062House Freedom\u200b Caucus \u200chave insisted\u200d they will \u2062not support the \u2063spending bills necessary to fund the \u2063government for its\u2063 next fiscal year\u2062 without paring \u200bback funding for the Affordable Care Act, commonly known \u2064as Obamacare. Their stance has raised concerns among investors and economists who fear the potential economic impact of a government shutdown.<\/p>\n<p>The prospect of a government shutdown has rekindled\u200d fears regarding the stability of \u200dthe \u2063U.S. economy. With the\u2063 Federal Reserve tightening its monetary policy and the resumption \u200dof payments\u2063 on student loans, a shutdown could further dampen economic growth. This\u2063 concern is\u200d compounded by the recent downgrade\u2063 of the U.S. credit rating by ratings agency \u2064Fitch, \u200cwhich highlighted political instability as one of the reasons \u2063for the downgrade.<\/p>\n<p>While past government shutdowns have had minimal impact on U.S. stocks, investors may be more cautious\u200b this time around due to the current economic and \u200dpolitical environment. The S&#038;P 500\u2062 has already experienced a decline following a surge in Treasury yields. Furthermore, a shutdown \u2062could result in spending cuts that could further slow\u2064 the economy.<\/p>\n<p>The possibility of a government\u200c shutdown should not be taken lightly, as it could have detrimental effects on the economy and investor confidence. It is important\u200b for lawmakers \u200cto find a resolution and pass a\u2064 new budget before the\u2062 September 30 deadline in order to\u200c avoid potential economic consequences.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>of the government could be forced to shut down, causing concerns among investors about the impact on the economy in the coming months and beyond.<\/p>\n","protected":false},"author":66,"featured_media":2041371,"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":[542],"tags":[],"class_list":["post-2041370","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-oann"],"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\/2041370","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\/66"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=2041370"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2041370\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2041371"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=2041370"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=2041370"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=2041370"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}