![]() ![]() A funding crisis creates a partial shutdown of non-essential government services – with the potential for about 800,000 employees to be furloughed. As such, even if the current budget debate were to take a similar course to that of 2011, there is no guarantee that investors’ response would be similar.īefore we get to 2011, it is important to note the difference between a a government funding crisis and a debt ceiling breach. However, it’s important to note that economic and financial conditions in 2011 were very different than they are today. Looking back at the summer of 2011 can be instructive for investors in terms of how different markets reacted at the time. So, if the budget debate in Washington comes down to the wire, what should investors expect? While there have been several government shutdowns over the past few decades including in 1995-96, 2013, and 2018-19, only during the summer of 2011 did the possibility of default come to the fore. government securities as well as in equities, gold and other assets. Regardless, Q3 2023 could be fraught with challenges for investors in U.S. ![]() The amount of tax revenues received in April could bring the date forward or push it back within the three-month range. The Congressional Budget Office suggested in mid-February that the government could run out of cash between July and September. The House of Representatives and the White House appear to be locking horns over the Federal budget and on raising the debt limit that could potentially delay coupon and principal payments on U.S. ![]()
0 Comments
Leave a Reply. |