This Government Shutdown Is Blinding Investors

The partial government shutdown is obviously affecting federal employees that aren’t getting paid, but for the most part, life goes on.

These federal workers might be in a pinch right now, but eventually, they’ll get paid back for doing nothing during the longest shutdown ever.

I agree with Fox contributor John Stossel who opined, “During shutdowns, the government tells ‘nonessential workers’ not to come to work. But if they’re nonessential, then why do we pay 400,000 of them?”

There’s so much government waste that taxpayers probably wouldn’t notice a change if many of these agencies permanently shut down!

However, the closure is impacting Treasury markets…

Investors aren’t getting important updated economic data from agencies that aren’t funded.

Housing and other data from November and now December are delayed because the U.S. Census Bureau, Department of Commerce, and the Department of Housing and Urban Development are closed.

Even Statistics Canada is blaming the U.S. shutdown on its ability to publish international trade data. I’m just wondering why they can’t track their own data…

For now, we’ll look at December’s existing home sales, which came out yesterday.

Existing home sales is a much larger number, but they don’t give the economy the boost from associated sales of appliances, furniture, and the like as new home sales do. Nonetheless, it’s a good indicator of where overall home sales are headed.

December existing home sales disappointed in a big way!

Sales were down 6.4% on the month and fell below 5 million units annualized. On the year, sales fell 10.3%. The median sales price fell to $253,600, or down 1.4%.

Mortgage rates fell in December. That should have helped sales. It didn’t.

Of course, the shutdown delayed closings for those getting FHA mortgages and other government guaranteed loans.

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