The Democrats and Republicans are doing the usual shutdown song and dance.
It will get resolved, it always gets resolved. The impacts are far more meaningful to people in news media and markets. The only trade that’s ever worked surrounding a government shutdown is to fade any initial market moves, because it’s always resolved.
Following the comments of politicians regarding the shutdown is a waste of time, because they’re rarely telling any kind of truth.
Maybe it will result in some economic data being delayed but that’s about the maximum extent that anyone in markets should care about the minute-to-minute of this latest saga. The longest ever shutdown came in Trump’s first term and lasted 35 days and the impact was 0.1 percentage points of GDP. The S&P 500 dipped 2.1% initially then ultimately rallied 10.1% during the shutdown.
In terms of data, it could lead to a 0.1 pp uptick in unemployment and around 40K jobless claims, which would quickly revert afterwards.
