The US Government shutdown could be the root of many problems if it keeps on. The possibility of the shut down continuing into February and maybe even March would cause growth rates to fall to a place where unemployment would creep up. According to the University of Michigan, consumer sentiment was at its lowest point since Trump won the election in 2016.
The key threshold mentioned in the article for GDP growth is 2%, according to Mark Zandi. Although, that is considered a modest estimate as 1st quarters tend to be slow and the shutdown does not help any growth.
After reading this article, it is difficult to ignore the fact that a lack of agreement between both parties could really put the economy in a tough place. Obviously it makes everyone question if all of this disagreement over a border wall is really worth the toll we are going to take on our economy. Before all of this, the economy was already looking like it was slowing down with the rising interest rates. This could really put a damper on the economy going into the 2nd quarter.
https://www.cnbc.com/2019/01/18/shutdown-if-not-resolved-soon-could-be-fodder-for-recession.html
2 comments:
This is an interesting article, I wonder if there are going to be many changes made since the government shutdown has been lifted for the time being. I do think that many of the economic indicators will be greatly effected due to the shutdown. I agree that it will damper the economy in the upcoming second quarter numbers.
Antonio , I agree i think this shutdown will effect some of the numbers in this upcoming quarter. Although i think our economy while might have slow growth, is decently healthy and will recover from this shutdown. The numbers might not be as good as we would like but i don't think its a reason for concern.
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