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Thread: govt shutdown & the mkt

  1. #1

    govt shutdown & the mkt

    M* has a home page article about the govt shutdown's influence on the mkt, which hasn't seemed to have happened. I'm curious about others' thots on this.
    Saw a report that said usually the mkt is not affected by a shutdown, although in Aug. '11, it did take a nosedive. NOt sure if the influence depends on the length or duration of the shutdown. When does a short-term term shutdown become a more drawn out, moderate or long-term shutdown?
    Personally, I have a fair amount of cash siding idly, & if there's a serious dip, I may put some $$ to work.
    Please let us know what u see in terms of how the shutdown could influence the mkt.

  2. #2
    You really need to confirm that either way or no one can advise

  3. #3
    My first thought was that having an additional 800,000 people unemployed is going to be a drag on an already slow economy. Since the stock market supposedly leads the economy, the effect that all of those unemployed may have on the economy, may have been discounted prior to the partial shutdown. If the shutdown drags out for very long, that discount may send stocks lower. However, I think an additional risk is the debt ceiling, which may come to a head in the next couple of weeks. If our government cannot agree to a budget, why should we think they can agree to a higher debt ceiling? It may take another week for that to sink in and for the market to go lower.

  4. #4
    I don't worry about the US govt shutdown. I'm EXTREMELY worried about the US defaulting on its debt due to politics.

  5. #5
    It appears that Boehner wants to hook the debt cieling to the budget and Obama doesn't want to do that. That headline came out about 1 hr before the stock market closed and the market sold off rather nastily before the close. Perhaps we are seeing the beginning of the end.
    What is everyones favorite technique for picking the bottom?

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