US again hits Debt Ceiling – Govt. faces Shut Down

With the US likely to hit its debt ceiling limit of USD 16.7 trillion on October 17, budget spending must be agreed before October 1 to prevent a government shutdown. It could involve actions like federal employees facing an unpaid temporary leave and a delay in the payment to military personnel. Barclays feels that the debt ceiling deadline will have a greater impact. Meanwhile, it is of the opinion that the financial markets can withstand short-lived shutdowns. In the past, S&P 500 fell 3.7 percent during the shutdown that happened in 1995. The US government has seen a total of 17 shutdowns in the past. Out of those, six of them lasted between 8-17 days in the late 1970s. The duration of these shutdowns shrank from 1980s. The longest recorded government shutdown in the history was in 1995. It lasted for three weeks under the then President Bill Clinton’s regime. Here is a list of all government shutdowns 1995-1996 (President Bill Clinton): December 5, 1995, to January 6,1996, – 21 days: 1995 (President Bill Clinton): Nov. 13 to 19 – 5 days: 1990 (President George H.W. Bush): October 5 to 9 – 3 days 1987 (President Ronald Reagan): December 18 to December 20 – 1 day 1986 (President Ronald Reagan): October 16 to October 18 – 1 day 1984 (President Ronald Reagan): October 3 to October 5 – 1 day 1984 (President Ronald Reagan): September 30 to October 3 – 2 days 1983 (President Ronald Reagan): November 10 to November 14 – 3 days 1982 (President Ronald Reagan): December 17 to December 21 – 3 days 1982 (President Ronald Reagan): September 30 to October 2 – 1 day 1981 (President Ronald Reagan): November 20 to November 23 – 2 days 1979 (President Jimmy Carter): September 30 to October 12 – 11 days 1978 (President Jimmy Carter): September 30 to October 18 18 days 1977 (President Jimmy Carter): November 30 to December 9 – 8 days 1977 (President Jimmy Carter): October 31 to November 9 – 8 days 1977 (President Jimmy Carter): September 30 to October 13 – 12 days 1976 (President Gerald Ford): September 30 to October 11 – 10 days

Source – Moneycontrol.com


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