Broker Check

Government shutdowns, funding gaps, and your money

| November 13, 2023

This is why we don’t get too worked up or worried over these news headlines. 

Since 1977 we experienced 20 funding gaps resulting/leading to 10 shutdowns.  On 1/1/1977 the Dow Jones Industrial Average (DJIA) stood at ~1005. At the end of last month the DJIA stood at 33,052.

During a period where we saw a funding gap roughly every couple years the stock market as measured by the DJIA price has gained over 30x!  and in fact if we use a total return measure it would be a staggering 80x1

Roughly every 2-3 years and yet market rises in face of it

Markets can be generally resilient in the face of negative headlines like those surrounding any government funding gap or shutdown  While there is always some appearance of uncertainty surrounding these events in terms of size and scope and news reports, historically 20 out of 20 times its been resolved.