Are Government Shutdowns Good for the Economy?

Mark Skousen

Named one of the "Top 20 Living Economists," Dr. Skousen is a professional economist, investment expert, university professor, and author of more than 25 books.
[U.S. Capitol]

“No man’s life, liberty or property are safe when the legislature is in session.” — Judge Gideon Tucker

The stock market has been soaring ever since the federal government shut down on Dec. 22 in a budget dispute between President Trump and the Democrats who now lead the U.S. House.

Ironically, the Dow has climbed more than 2,000 points. I jokingly told my libertarian friends that maybe the surge suggests that the Feds should close their doors permanently…

Economists estimate that the government shutdown is slowing economic growth, but only about 0.1% percentage point so far.

I can think of a lot of good reasons to use a shutdown to threaten Congress but building an expensive wall along the Mexican border isn’t one of them. Is there really a national emergency when illegal immigration has fallen by an estimated 80% since 2000?

Eventually President Trump will come to his senses and compromise, and the Feds will start spending funds they don’t have…

Does anyone care that the federal deficit is expected to increase by $1 trillion next year? Now that’s an issue worth a fight with Congress.

What will the stock market do once federal workers go back to work?

According to LPL Financial, the S&P 500 has climbed during 14 of the past 16 shutdowns since 1976 — including the current partial shutdown, which is the longest on record and rose 13% on average in the year following the reopening of the government. On only two occasions, 1976 (-6.6%) and 1983 (-0.4%), did the S&P 500 lose in the 12 months after the shutdown ended. The rest of the time, stocks were up sharply by an average 17%!

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So, the future still looks bright on Wall Street.

Good investing, AEIOU,

Mark Skousen

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You Blew It!

Expletive Deleted. Not! Time to Boycott Barnes & Noble! 

I recently walked into a Barnes & Noble bookstore to buy a book and browse, which is what I like to do to see what books are being published these days.

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I’ve noticed a trend over the past few years for publishers and writers to come up with more brash titles; they have even gone so far as to use titles with gutter words from sh— to the F-bomb. I saw three-four books with the F-bomb in their titles. In each case, the “u” was replaced with an asterisk, as if that makes it okay.

They were all prominently displayed up front at Barnes & Noble, suggesting they were popular titles.

Then, I saw a book right next to one of these F-bomb books called, “SHAME.” I took it up to counter and told the clerk, “These two books belong together.” He nodded in agreement.

I told him I was fed up with this new trend among publishers, and blamed Barnes & Noble for prominently displaying these shameless books on the shelves out in the open for anyone to see, like the nudie magazines of yesteryear. I told him I don’t particularly like to be slapped in the face with such vulgarities, and told him, “Tell your manager this will be the last time I will shop at Barnes & Noble.” I was so incensed.

Is nothing sacred anymore, even book titles?

Have we reached the point where there is no such thing as shameful behavior and vulgar language?

I say it is time to stand up and complain, loud and clear. Tell the clerks and managers at Barnes & Noble that until they remove these titles from their stores, or at least hide them behind the counter, you won’t patronize them anymore. They are already afraid of Amazon. Now they have something more to fear.

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Dr. Mark Skousen

Named one of the "Top 20 Living Economists," Dr. Skousen is a professional economist, investment expert, university professor, and author of more than 25 books.

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