After Republicans rejected Speaker McCarthy’s effort to keep government offices open…
I honestly thought a shutdown was inevitable, but thankfully…
The Senate passed a last-minute spending bill Oct 31st night, averting a federal government shutdown that would’ve been devastating for millions of Americans.
How devastating?
Well, without a deal in place, over two million Americans who are federal employees –– plus the 1.3 million active-duty troops — would feel the effect immediately if their agencies aren’t funded. Essential workers would remain on the job, but others would be suspended until the shutdown is over. None of these would be paid during the standstill.
For some, losing out on income for one, two, or three pay periods can be the difference between paying rent or a mortgage. In other words, a government shutdown would strain many people’s finances, as it did during the record 35-day funding lapse in 2018-2019.
And what happens if you have any money in the markets?
You likely noticed investors and financial experts weren’t worried about a shutdown.
That’s because markets have been there 21 times since 1975 and emerged unscathed.
That isn’t to say that stocks won’t get jumpy if the government goes into a more prolonged shutdown. But any significant market moves in the coming months will have more to do with economic data than with what politicians are doing right now.
No one knows if things will improve or worsen. But if you have any money in the markets, you’d be wise to build strategic “income-growth” positions that protect you from economy-driven market fluctuations in the days, weeks, and months ahead.
I hope that makes sense.
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