A debt ceiling crisis has been averted, but what happens now? And what kind of damage has been done to the U.S. economy?
The ratings agency Standard & Poor's forecasts that fiscal brinksmanship in Washington has cost the economy $24 billion, or 0.6% of fourth-quarter growth because of reduced government spending. Functions like import inspections, export financing and government permitting were halted as a result of the shutdown.
And then, of course, the uncertainty monster is still haunting the economy, spooking businesses and consumers. Because the deal to fund the government and raise the debt ceiling is short term, it could soon be lather, rinse, repeat when it comes to the brinksmanship we've just gone through.
But in the accompanying video, Jeremy Hill of TF Market Advisors tells us he doesn't think the damage from the shutdown will be that bad.
“I do love the stories about microbrewers not being able to ship out their beer because they don’t have the appropriate stamp on it – that matters to me, for sure – but I have to tell you I think the magnitude of the effect on the economy will actually be quite small," he says. "In fact, if we get a little bit of a bump in GDP going forward that wouldn’t surprise me. I think we’re positioned to be okay in the fourth-quarter, and the market probably has a 5% upside from here."
Why does Hill think that? Check out the video above and see how the band Talking Heads can shed light on his situation.
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