By Peter R. Wechsler
President & Co-Founder, Franklin Retirement Solutions
[email protected]
The government shutdown is really starting to affect the economy. Millions of folks are being seriously affected, including federal employees and government contractors, along with the 42 million SNAP recipients. Let’s remember that the shutdown is due, in large part, to the Republicans’ desire to remove premium subsidies for millions of people on the ACA (Obamacare) which would cause premiums to skyrocket on January 1st and the Democrats’ subsequent defense of those subsidies.
Starting today, flights are going to be cancelled as there is a shortage of air traffic controllers. Security line waiting times at some airports are longer than two hours.
Hopefully there is an end in sight. Maybe the House of Representatives will come back to Washington after being out of session for over a month. Hopefully Senators will figure out a compromise on the Obamacare issue before they send the bill back to the House. If they blow up the filibuster the government will reopen quickly, but Senate Majority Leader Thune says he won’t support getting rid of the filibuster.
Both parties are always at each other’s throats. That’s politics. If the filibuster survives, then the majority party will need to negotiate with the minority party in order to get to the 60 votes needed in the Senate. Fun times but that’s the way it works.
The markets have been on edge for weeks, even though we saw nice market gains in October. In fact, October was the 6th month in a row for gains in the S&P 500. With unemployment rising, with the Fed not sure it’ll lower rates again in December, and with the tariffs adding to inflation, we could see a market pull back from recent record highs.
With the S&P 500 up 75% since the beginning of 2023, many clients now have a higher percentage of money in the markets than they had a few years ago. Is it time to take a fresh look at the balance you have between money at risk to the stock, bond, & crypto market and your safe money in banks, annuities and treasury bills? Know that we will be reviewing this with you the next time we get together. Want to talk before our next scheduled Forward Focus Meeting? Just give us a call and we’ll get you on the calendar.
Let’s hope the government reopens and the Eagles win on Monday night…
Peter