Shut down! Shut down! Shut down!

The end of Q3 is now. September 30^th. The pumpkins are ripe, the nights are cool, and the politicians are ICE cold. When most of us awaken tomorrow morning, we will know if the Government is working for us or not.  The freeze in dialogue is not unexpected given the growing contentiousness within the body politic.

The Financial news channels I am exposed to have said “We are staring down the barrel?”, “Will this be a chicken Little moment?” the hyperbole is tiring. “It’s a Schumer Shutdown! Trump will cut Medicare! Obamacare is being cut!” The clean Continuing Resolution has been offered.

In the past 28 years, policymakers have passed 134 interim and 4 full-year CRs ranging from 21 to 216 days. (source bipartisanpolicy.org) a continuing Resolution simply maintains government spending for 6 more weeks while Congress can negotiate a lasting spending plan.

We may not get NFP on Friday if the Shutdown occurs or any other economic data reports during a Government Shutdown.

How will the markets react to a government shutdown you ask?

For the S&P 500, S&P 500 Performance During the Last 8 Shutdowns

The table below summarizes the S&P 500’s total return (price change from the close before the shutdown to the close on the resolution day) for each event. Data is sourced from analyses of historical market performance.