Are Government Shutdowns Good for the Economy?

bclinesmith

“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%!

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.

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.

Mark Skousen

Mark Skousen, Ph. D., is a professional economist, investment expert, university professor, and author of more than 25 books. He earned his Ph. D. in monetary economics at George Washington University in 1977. He has taught economics and finance at Columbia Business School, Columbia University, Grantham University, Barnard College, Mercy College, Rollins College, and is a Presidential Fellow at Chapman University. He also has been a consultant to IBM, Hutchinson Technology, and other Fortune 500 companies. Since 1980, Skousen has been editor in chief of Forecasts & Strategies, a popular award-winning investment newsletter. He also is editor of four trading services, Skousen TNT Trader, Skousen Five Star Trader, Skousen Home Run Trader, and Skousen Fast Money Alert. He is a former analyst for the Central Intelligence Agency, a columnist to Forbes magazine (1997-2001), and past president of the Foundation for Economic Education (FEE) in New York. He has written articles for The Wall Street Journal, Liberty, Reason, Human Events, the Daily Caller, Christian Science Monitor, and The Journal of Economic Perspectives. He has appeared on ABC News, CNBC Power Lunch, CNN, Fox News, and C-SPAN Book TV. In 2008-09, he was a regular contributor to Larry Kudlow & Co. on CNBC. His economic bestsellers include “Economics on Trial” (Irwin, 1991), “Puzzles and Paradoxes on Economics” (Edward Elgar, 1997), “The Making of Modern Economics” (M. E. Sharpe, 2001, 2009), “The Big Three in Economics” (M. E. Sharpe, 2007), “EconoPower” (Wiley, 2008), and “Economic Logic” (2000, 2010). In 2009, “The Making of Modern Economics” won the Choice Book Award for Outstanding Academic Title. His financial bestsellers include “The Complete Guide to Financial Privacy” (Simon & Schuster, 1983), “High Finance on a Low Budget” (Bantam, 1981), co-authored with his wife Jo Ann, “Scrooge Investing” (Little Brown, 1995; McGraw Hill, 1999), and “Investing in One Lesson” (Regnery, 2007). In honor of his work in economics, finance, and management, Grantham University renamed its business school “The Mark Skousen School of Business.” Dr. Skousen has lived in eight nations, and has traveled and lectured throughout the United States and 70 countries. He grew up in Portland, Ore. He and his wife, Jo Ann, and five children have lived in Washington, D.C.; Nassau, the Bahamas; London, England; Orlando, Fla.; and New York. For more information about Mark’s services, go to http://www.markskousen.com/