In the past 12 months, the American stock market has grown by over 30%, and the government debt has grown from 108% to 126% of the GDP. The massive support of the economy has led to the U.S. Department of the Treasury having money only until the middle of October. If Congress does not approve of borrowing above the limit, the government will have to suspend work (the shutdown mode), and in the event of the aggravation of the situation, it will declare a default.

If case of the negative scenario, the federal government will have to take an unprecedented cutdown in spending, which, according to Moody’s, will lead to the loss of 6 million jobs, the unemployment rate rising to 9% and the stock market falling by 30%.

At the moment, the Republicans are blocking the passage of the budget project to get a series of concessions from the Democrats. The deadline date set by the Secretary of the Treasury Janet Yellen is 18 October.

However, one should know that government shutdowns and the elevation of the state debt ceiling are common phenomena for the USA. Thus, the government suspended work three times in the last four years, and twenty times since 1977. Every time, Congress was able to smooth the edges to restart the economy until the next elevation of the budget debt.

Until a compromise is found, the markets will stay under pressure.

Analytical group StormGain
(a platform for trading, exchanging and storing cryptocurrencies)