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Shutdown Would Shave Fourth-Quarter U.s. Growth As Much As 1.4%

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http://www.bloomberg.com/news/2013-09-27/shutdown-would-shave-fourth-quarter-u-s-growth-as-much-as-1-4-.html

A shutdown of the U.S. government would reduce fourth-quarter economic growth by as much as 1.4 percentage points depending on its length, economists say, as government workers from park rangers to telephone receptionists are furloughed.

Mark Zandi of Moody’s Analytics Inc. estimates a three-to-four week shutdown would cut growth by 1.4 points. Moody’s projects a 3 percent rate of growth in the fourth quarter without a closure. A two-week shutdown starting Oct. 1 could cut growth by 0.3 percentage point to an annualized 2.3 percent rate, according to St. Louis-based Macroeconomic Advisers LLC.

A shutdown would slow the expansion because output lost when workers are furloughed subtracts from gross domestic product. The combined prospect of a budget standoff between the White House and Congress and haggling over the debt ceiling could have a bigger impact on the economy as businesses hold off on investment and households delay spending.

Shocking if the US govt stops spending and borrowing money GDP contracts. However I highly doubt the US govt will shut down, deals will be made and the responsible debt ceiling will be increased by $1tr or maybe a bit more to get them through to the next election and create a nice problem for the new President.

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http://www.bloomberg.com/news/2013-09-27/shutdown-would-shave-fourth-quarter-u-s-growth-as-much-as-1-4-.html

Shocking if the US govt stops spending and borrowing money GDP contracts. However I highly doubt the US govt will shut down, deals will be made and the responsible debt ceiling will be increased by $1tr or maybe a bit more to get them through to the next election and create a nice problem for the new President.

who was it who said "the worst nine words in the world are ...I'm from the government and I'm here to help"?

..might be quite amusing to see the response if government DOES shut down.....after a couple of days of furore...the I might suggest the people will start to discount them and GDP may actually go UP, as people are left alone from constant meddling and can actually get things done and make stuff without drowning in a sea of beaurocracy.

I'm sure the PTB are hoping that people feel totally dependent on the system,and will be screaming and howling with withdrawal symptoms like heroin addicts when the plug gets pulled.......but there's maybe a bit of a silver lining to this cloud.

maybe there's a few bright sparks out there who say...."ok, so what, central planning has totally failed anyway......so now we do the opposite.

free solar panels for eveybody,get off the grid....

..we asked some icelandic geo-engineers about the possibility of having a geotherm power plant in yellowstone...and they're on the case as we speak,....

and while we're at it he'res some new designed carbeurettors(made clandestinely in house for the past 5 years ) for that 4 litre V12 thingy you're running around in....easy to retrofit and does 3 times the mileage......we raided the patent office and gave the inventor a couple of million $, but he's happy because this is a matter of national security.

......have these on us too.

......oh and we've brewed up some GM enzymes that can ferment your grass clippings and poo into useable fuel in turbocharge....all you need is a bottle of these, a pressure cooker and said solar panel to power a nice little halogen top.

Edited by oracle

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Yahoo Finance 29/9/13

'The US government was on the brink of shutting down Sunday after the House of Representatives approved a Republican bill seeking to delay President Barack Obama's health care law.

Congress now has less than 48 hours to strike a deal that keeps the government open, but the ping-ponging of legislation is making that unlikely. Obama has already threatened to veto any bill seeking to halt his sweeping health overhaul.'

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http://www.bbc.co.uk/news/world-us-canada-24343698

The US government has begun a partial shutdown after the Republican-led House of Representatives refused to approve a budget for next year.

A midnight deadline passed without agreement despite a last-gasp appeal by President Barack Obama.

I think I've read they've got money till the 17th Oct, so they have some wiggle room. What happens after that is anyone's guess.

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It is all complete pantomime to try and show the people how much they need government. Does anyone really think that this is not all planned out well in advance.

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I don't understand how shutting down can save money. I'd have thought all the chaos would have increased the costs of running things. At the end of the day, the work will have to be done, and presumably overtime have to be paid.

Now if they were cutting programms or purchases, i would understand.

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I don't understand how shutting down can save money. I'd have thought all the chaos would have increased the costs of running things. At the end of the day, the work will have to be done, and presumably overtime have to be paid.

Now if they were cutting programms or purchases, i would understand.

I 1/10/13

'With no budget, the US government will have no choice but to send hundreds of thousands of federal workers on unpaid leave, affecting agencies as varied as the Justice Department, Nasa, the National Parks Service and the Pentagon in the first shutdown in nearly two decades.'

Edited by Sancho Panza

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It is all complete pantomime to try and show the people how much they need government. Does anyone really think that this is not all planned out well in advance.

Yep got to make out theres a bit of resistance before they hit the print button

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It is all complete pantomime to try and show the people how much they need government. Does anyone really think that this is not all planned out well in advance.

Not working judging by some of the comments from Americans on the street, in I presume, Washington.

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I don't understand how shutting down can save money. I'd have thought all the chaos would have increased the costs of running things. At the end of the day, the work will have to be done, and presumably overtime have to be paid.

Now if they were cutting programms or purchases, i would understand.

Some of the shut down stuff is part of their tourist/holiday attractions, they can just shut it and send staff home on no pay? But there will be a cost in credibility and tourist dollars if it goes on a while?

Edit: Just read the post above about what is actually going to be affected. This is a big deal, hundreds of thousands of government workers on UNPAID LEAVE, in the country that holds the worlds reserve currency? That sort of stuff happened before the collapse of the USSR?

Edited by dances with sheeple

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It will all be fine in the end. More printy.

Yep, they'll print more, similarly the debt ceiling will be raised and everyone will celebrate how marvellous everything is.

Saw Obama on the news earlier celebrating the fact the deficit is coming down the fastest in 50 years.

http://www.huffingtonpost.com/2013/08/12/us-budget-deficit_n_3745096.html

The government on Monday reported a $97.6 billion deficit for July but remains on track to post its lowest annual budget gap in five years.

July's figure raises the deficit so far for the 2013 budget year to $607.4 billion, the government says. That's 37.6 percent below the $973.8 billion deficit for the first 10 months of the 2012 budget year.

The Congressional Budget Office has forecast that the annual deficit will be $670 billion when the budget year ends Sept. 30, far below last year's $1.09 trillion. It would mark the first year that the gap between spending and revenue has been below $1 trillion since 2008.

He's right to celebrate, it should be below $1tr champers all round I think.

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Some of the shut down stuff is part of their tourist/holiday attractions, they can just shut it and send staff home on no pay? But there will be a cost in credibility and tourist dollars if it goes on a while?

Edit: Just read the post above about what is actually going to be affected. This is a big deal, hundreds of thousands of government workers on UNPAID LEAVE, in the country that holds the worlds reserve currency? That sort of stuff happened before the collapse of the USSR?

It is not just the loss of state workers spending that is going to hit the economy The US government is the single biggest purchaser of goods and services from the private sector on the planet. If this goes on any length of time the layoffs will ripple out to people a long way from Washington and the central state bureaucracy.

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