A Brief History of Government Shutdowns
The U.S. government has shut down after Congress failed to reach a funding agreement earlier this week. This is the 11th government shutdown since 1981. During shutdowns, non-essential government operations are generally put on hold, while essential services continue. Here is how the S&P 500 has fared during past shutdowns:
As illustrated above, shutdowns have occurred regularly under presidents of both parties. The majority of shutdowns lasted three days or less. Four shutdowns lasted five days or more. These four instances came under Presidents Clinton (twice in 1995), Obama (2013) and Trump (2018). What's remarkable is how minimal their long-term impact has been on financial markets.
While government shutdowns have historically caused temporary disruptions, they have generally not derailed economic growth or investment portfolios over the long run.
If you would like additional insights or guidance, schedule a call.
-------------------
All content is for informational purposes only. It is not intended to provide any tax or legal advice or provide the basis for any financial decisions. Nor is it intended to be a projection of current or future performance or indication of future results. Past performance is no guarantee of future results. Purchases are subject to suitability. This requires a review of an investor’s objectives, risk tolerance, and time horizons. Investing always involves risk and possible loss of capital. Opinions expressed herein are solely those of Darrell Capital Management, LLC. The information has been derived from sources believed to be reliable but is not guaranteed as to the accuracy and completeness and does not purport to be a complete analysis of the materials discussed. All information and ideas should be discussed in detail with your financial, tax and legal advisors prior to implementation. The information contained herein should be in no way be construed or interpreted as a solicitation to sell or offer to sell advisory services to any residents of any state other than the State of California or where otherwise legally permitted. Advisory services are offered by Darrell Capital Management, LLC, an Investment Advisor in the State of California. Being registered as an investment advisor does not imply a certain level of skill or training. Social post reactions and comments should not be viewed as endorsements or testimonials.