The "No Deal": How Congressional Gridlock Affects YOU

Though the markets inexplicably rose on the first day of congressional gridlock in Washington, today a drop of 58.56 points on the Dow marks the beginnings of what could be a very long standoff. Instead of diving into who is to blame, let us focus instead on what the government shutdown will do to your financial health.
 
Obviously, major drops in US markets and other financial markets tied to the economic well-being of the US will shrink your investments. What shutdown also does is prevent you from applying for small business loans, applying for Medicare and Social Security benefits (although people already enrolled will continue to receive benefits), and prevent you from visiting national parks, landmarks and monuments. If you had planned a vacation to Yellowstone or DC, you may have to suspend your trip, which can cost hundreds to thousands of dollars in fees from airplane tickets, car rentals and hotels. Fortunately, there is one silver lining; the last time the government shut down (in the 1990s), the markets shot up about 7% once a deal was reached. After a few days, the market will be so jaded with Congress that it will continue as normal or start plummeting down. This can be a great opportunity to buy at lower prices, assuming that Congress manages to save itself in time.
 
The next big battle is on October 17th, when the US runs out of money again. If nothing is done, then the US will default on its loans for the first time in history. Should this happen, financial darkness will fall.
 
~Andrew Jabara
President of the E-Stock Club