All eyes were on Washington this October. The federal government shuttered its doors and the nation’s “leaders” brought the United States perilously close to a default on national debt. Financial thought leaders turned their attention to the manufactured crisis. While the issue is now resolved for the time being, this month we examine how top asset management firms responded to the crisis:
1. OppenheimerFunds: Debt Ceiling What if the Worst Doesn’t Happen – Chief Economist Dr. Jerry Webman weighed in on the shutdown gridlock. Dr. Webman opined that it might be possible for Congress to reach a deal that could help spur future growth. The article recommends that investors remember that positive outcomes can happen.
OppenheimerFunds Blogs on the Debt Showdown
3. Invesco: The U.S. Government Shutdown and the Debt Ceiling – Invesco’s John Greenwood explains that the October 17 debt ceiling deadline represented a likely date for the crisis to reach its end. Greenwood notes that the shutdown reduced the GDP by about $160 million per day due to furloughed workers not receiving pay. The article explains that in 2011, Treasuries performed well following the shutdown due to their “safe-haven” appeal outweighing credit concerns.
Invesco’s John Greenwood Examines the Debt Ceiling
5. Allianz: Making Sense of a Senseless Shutdown – Allianz’s Peter Lefkin and Kristina Hooper provide their own insights on the shutdown. The authors note that the shutdown contributed to a sense of disgust among the public for Congressional leaders, particularly those in the Republican Tea Party. Lefkin and Hooper predict that one result of the shutdown will be an extension of QE.