Though the government shutdown has yet to have a big impact on consumer spending, if the closure continues to drag on, this could change, according to Ford’s chief economist. The shutdown could impact AGRR if consumers lose confidence that an end to the political stalemate is near and curtail their spending on these services.
Ford’s senior economist cautions that the government shutdown could have an impact on vehicle sales.
“At this point, we don’t know. It’s too early to tell [what the impact could be.]” says Jenny Lin, according to a local report. “… Any type of disruption in government operations would adversely affect government spending, consumer confidence and financial markets. So we urge leaders to work together and remain hopeful the shutdown won’t be very long.”
Moody’s chief economist also offered some insight.
“If policyholders can get it together in the next few days then we are okay,” he says in a recent webinar. “If they can’t and we go into next week, the prospects don’t appear good … If they can’t get it together by October 17 we are toast and will go into a recession.”
However, on a more positive note, he adds, “When push comes to shove, they [Congress] will sign on the bottom line and the fiscal drag will fade.”
The shutdown shows no signs of ending, and a big factor delaying a resolution could be President Obama, according to another report. He does not have to worry about being re-elected and therefore does not need to worry about a big sticking point to a potential compromise—health care. The shutdown came on the first day of enrollment for the new health-care law, which Republicans strongly oppose.
House Speaker John Boehner, a Republican from Ohio, and President Obama, a Democrat from Illinois, have “tried and failed to negotiate big deals several times. Since the government shutdown on Tuesday, they’ve barely talked aside from a meeting the president held with top congressional leaders on Wednesday afternoon,” the report points out.
What impact do you see the shutdown having on your business? Email your thoughts to firstname.lastname@example.org.