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Government Shutdown Begins After Senate Rejects Eleventh-Hour Funding Agreement

1. First government shutdown since 2019 impacts federal services and workers. 2. Senate fails to pass funding agreement; furloughs estimated at 750,000 daily. 3. Shutdown could cost economy $1 billion weekly, including travel disruption. 4. Trump signals shutdown is likely; Democrats could politically benefit. 5. Previous shutdown under Trump lasted 35 days, causing significant delay.

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FAQ

Why Bearish?

Government shutdowns often lead to economic uncertainty, negatively impacting market confidence. Historical cases, like the 2018 shutdown, correlated with volatility in the S&P 500.

How important is it?

The shutdown's impact on federal spending, workers, and market confidence directly influences investor decisions and may affect earnings projections.

Why Short Term?

The immediate effects from the shutdown may drive volatility, but long-term impacts depend on resolution. Previous shutdowns caused short-term market corrections that were recovered once resolved.

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