andrewunknown

'95-'96 Government Shutdowns: How Did SPX Fare?

INDEX:SPX   S&P 500 Index
1174 15 12
November 1995's shutdown saw a net gain of ~1.3%.

SPX             was +12.1% 90 days later.


December 1995-January 1996's shutdown saw a negligible net gain of 0.05%.

SPX             was +3.9% 90 days later
Honestly, I think a shutdown is bullish!
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QuantitativeExhaustion PRO DuncanParker
3 years ago
Agree.. Most are thinking .. Remember Post New Years 2013 Huge Gap Up after Fiscal Cliff
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andrewunknown QuantitativeExhaustion
3 years ago
radically different macro context, but similarly teflon bull market. Those who think the former matters in the short-term see only downside; while those who realize the former doesn't mean anything in the short-term are far less worried.

I'm wary of "all other things being equal" analogs - especially that are 18 years apart - but it's helpful.

Anyway, "shutdown" is a major fearmongering misnomer. An impasse that see the debt ceiling not being raised the more legitimate event to fear - especially if we see Moody's or Fitch (or both) follow S&P into a sovereign downgrade.
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QuantitativeExhaustion PRO andrewunknown
3 years ago
I agree, Debt Ceiling is more important. However, we have the Fed no taper (bullish motive) to push up into December (the next Fed major press event). I don't see a taper there as well.. The end goal is for the Fed to buy 20% of US debt. At the rate we are going purchasing and spending, that might take us to end of 2015.
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andrewunknown QuantitativeExhaustion
3 years ago
How long, oh market gods, how long until the farcical POMO/flow effect mythos is debunked? Nice dream; but I think the length of the dreams means it will end in tears.
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