Friday, January 18, 2019

CNBC on the economic effect of the shutdown as it hits four weeks

I told my readers to "stay tuned" at the end of 'Late Night with Seth Meyers' takes a closer look at the FBI investigating whether Trump worked for Russia as "I plan on returning to the shutdown" today.  I have had enough of comedy, so I'm turning to CNBC, which reported Trump administration doubles estimate of shutdown cost to economy from original forecast on Tuesday.
The Trump administration now estimates that the cost of the government shutdown will be twice as steep as originally forecast.

The original estimate that the partial shutdown would subtract 0.1 percentage point from growth every two weeks has now been doubled to a 0.1 percentage point subtraction every week, according to an official who asked not to be named.
That's the same estimate from Effects of the shutdown from local news six years ago, in which I wrote "one week of shutdown takes 0.1% off the GPD for a quarter."  I wrote that estimate was still true in The shutdown is disrupting American science.  Nice to see that the current administration's economists finally came around on this.

Now, why did they change the estimate?
The administration had initially counted just the impact from the 800,000 federal workers not receiving their paychecks. But they now believe the impact doubles, due to greater losses from private contractors also out of work and other government spending and functions that won't occur.

If the shutdown lasts the rest of this month, it could subtract a sizable half a percentage point from gross domestic product, the official said.
Here's the video segment with Steve Liesman: Trump administration sees half a percent GDP loss if shutdown continues through January.

CNBC's Steve Liesman reports on the Trump administration's warning stronger negative impact on GDP than first expected from the shutdown.
On Wednesday, CNBC interviewed another economist that made en even more dire forecast, The government shutdown will erase all Q1 growth: Economist.

Ian Shepherdson, Pantheon Macroeconomics founder and chief U.S. economist, joins "Squawk Box" to discuss how the partial government shutdown is impacting the economy.
Yikes!  When it looks like I was more right than I thought when I wrote that the shutdown could speed up the arrival of the next recession.

CNBC continued to hit this message, uploading Michael Townsend talks the economic impact of the shutdown this morning.

Michael Townsend, Charles Schwab and Co. VP of Legislative and Regulatory Affairs, discusses the ongoing government shutdown and its effect on markets.
Those are the macro effects.  For the micro effects, in other words, how the shutdown is inconveniencing people, watch Here's how the government shutdown is affecting small business, also uploaded this morning.

CNBC's Kate Rogers reports on how the government shutdown, now entering its 28th day, is affecting small businesses and entrepreneurs all across the country.

Finally, Here are some key dates to watch for during the shutdown looks to the future.

"Squawk Box" reports on some of the top stories affecting the business world.
"End this already!"  I can't agree more.

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