Financial experts anticipate economic downturn after shutdown - WQOW TV: Eau Claire, WI NEWS18 News, Weather, and Sports

Financial experts anticipate economic downturn after shutdown

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MADISON (WKOW) -- The federal government shutdown is likely to have an impact on the nation's economy, especially if it continues for several weeks.

In the short term, the government shutdown caused fear. Monday the stock market dropped, but Tuesday when the shutdown took effect the market recovered. 

Madison area financial advisor Brent Lindell says with hundreds of thousands of federal employees on furlough, a continued shutdown could have a significant effect on the economy.

"We are going to see some economic downturn because of what happened with the shutdown of the government," says Lindell. "Because of those non-essential personnel; you're seeing them not take home a paycheck, they're not going out into the economy and spending those dollars, and you're not seeing that spread out through the economy."

Lindell anticipates some volatility in the market in the coming weeks, especially if a shutdown continues until the debt ceiling deadline on October 17. 

"We're going to potentially default on loans," Lindell predicts. "That affects the credit rating of U.S. treasuries, that could be disastrous. It could be not only domestic, it could be an international, global volatility."
 
Lindell says the general public should not panic. He recommends staying invested and riding out the fluctuations in the market.

 

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