Historically, shutdowns have not been the market killer many fear.
The last 6 shutdowns all saw the S&P 500 rise from start to finish. Even the 35-day freeze in 2018–19 saw the index surge nearly 10%. Yes, Powell’s dovish pivot helped then but the bigger takeaway is clear: markets shrugged off the shutdown and rallied. Why? Because markets hate uncertainty, but they also know every shutdown will eventually be resolved. Source: Stockmarket.news
StockMarket.news >>> Shutdowns don’t mean every federal worker goes home.
In fact, the majority keep working but many do so without pay. Defense alone accounts for over 800,000 employees, with nearly half exempt to maintain readiness. Veterans Affairs and Homeland Security also keep most staff on the job. By contrast, agencies like Treasury, Agriculture, and Commerce see heavier furloughs, meaning critical services like tax processing, farm programs, and trade oversight grind to a halt. All told, nearly 900,000 workers could be directly furloughed this time, while millions more are forced to work without pay, highlighting just how disruptive a full shutdown really is. Source: stockmarket.news
The federal government has officially shut down after Congress failed to pass short-term funding
Source. ABC News
According to CNBC, a looming federal government shutdown appeared even more likely after top Democrats and Republicans met with President Donald Trump at the White House on Monday.
“I think we’re headed to a shutdown because the Democrats won’t do the right thing,” Vice President JD Vance told reporters after the meeting, which came less than two days before the shutdown will begin in the absence of a funding deal. The Democratic participants, House Minority Leader Hakeem Jeffries and Senate Minority Leader Chuck Schumer, likewise said that the two sides remain far apart. “We have very large differences,” Schumer said after the meeting. But he added that he believes Trump heard Democrats’ objections “for the first time,” suggesting the face-to-face was at least partially constructive. Both sides continued to assert that the other will be to blame if the government shuts down starting Wednesday. Source: CNBC, Reuters
The effective US tariff rate on China (red)
The effective US tariff rate on China (red) based on imports and estimated duties paid - has stabilized near 43%, which is up from 17% before Trump 2.0 and up from 5% before Trump 1.0 before that. The effective tariff rate on everyone else (excluding Canada and Mexico) is 14%. Source: Robin Brooks on X
LAST MINUTE: Trump to Meet Top Congressional Leaders as US Shutdown Near¨s
The top four congressional leaders will meet with President Donald Trump at the White House on Monday. *JEFFRIES: 'HOPEFUL' ABOUT AVOIDING GOVERNMENT SHUTDOWN. House Minority Leader Hakeem Jeffries said Sunday he is "hopeful" a government shutdown can be avoided as Congress lurches toward its Tuesday deadline to reach a spending agreement. Jeffries' comments come after President Donald Trump canceled a meeting last week with Jeffries and Senate Democratic leader Chuck Schumer to hammer out a deal before saying Saturday he'd meet with the Democrats and Senate Majority Leader John Thune and House Speaker Mike Johnson on Monday. Source: Jim Bianco
Government shutdowns all have the same cause:
Congress fails to approve new spending when previous spending bills expire. But their impact can vary based on timing, duration and quirks of the budget process that can make money available to some agencies but not others. Here's what shuts down in a shutdown - Bloomberg
President Trump rolled out a new round of tariffs:
•25% on all heavy trucks •30% on upholstered furniture •50% on kitchen cabinets, bathroom vanities, and related products •100% on branded or patented pharmaceuticals unless the company is building its manufacturing plant in the US Source: StockMarket.news
