Investing and Global Finance News

Business Leaders Remain Hopeful Despite Shutdown

The partial government shutdown on Tuesday had a minimal impact on business leaders. Partisan brinkmanship is not new to Washington, and according to the Boston Globe, businesses aren’t expecting any major changes in the near future. However, a threat does loom over the heads of business owners; when the federal government reaches its borrowing limit in the next two weeks, Congress will be forced to increase it or allow the U.S. to essentially default on its debt.

“The last time Congress tested the debt ceiling two years ago, the political stalemate unsettled global financial markets, caused stocks to tumble around the world, and dealt a setback to the economic recovery before Republicans and Democrats reached an eleventh-hour compromise,” the Boston Globe explained.

Nigel Gault of the Parthenon Group “The government can be shut down for quite a while without doing serious damage to the economy. Triggering the debt ceiling would very likely cause a recession. And if we go right up to the last minute, stock markets will panic.”

The University of Massachusetts and the Federal Reserve Bank of Boston recently published an assessment of the economic condition of the state.

“The sequester, the budget battle, and the debt limit brinksmanship threaten our fragile and sluggish recovery,” the report states, “and only extend the pain being experienced by families and businesses still awaiting an opportunity to participate in a recovery that is now several years old.”

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