The Week in Review: November 17, 2025
Investors Unfazed by Shutdown
The government shutdown lasted from October 1 to November 12. It was the longest on record. During that period, the S&P 500 rose from 6,688.46 (September 30) to 6,850.92 (November 12), or an advance of 2.4%. As we’ve noted in prior shutdowns, investors typically ignore political drama.
What is the reason for the general lack of investor interest? Well, let’s put the cost in perspective. According to the nonpartisan Congressional Budget Office (CBO), the cost of what is technically called a “lapse in discretionary appropriations” could shave 1.5 percentage points off Gross Domestic Product (GDP) in Q4. At first glance, that sounds significant.
Yet, now that the shutdown is over, GDP will likely get a short-term boost as delayed spending kicks in. Most of the lost output will eventually be recovered, although not all of it.
The CBO estimates that between $7 billion and $14 billion in total output is lost forever.
According to the Bipartisan Policy Center, at least 670,000 federal employees were furloughed, while about 730,000 others continued to work without pay. Plus, millions of federal contractors were affected. So, consumer spending is impacted, at least temporarily.
So, $7 to $14 billion is a significant sum of cash, unless it’s stacked up against the enormous size of the US economy—$30.5 trillion at the end of the second quarter, according to the US Bureau of Economic Analysis. That’s 0.047% of GDP. Q3 GDP was delayed due to the shutdown.
Earnings Impact
For the most part, profits at the nation’s largest companies reflect economic activity.
According to FactSet, the term “government shutdown” was cited on 76 earnings calls conducted by S&P 500 companies between September 15 and November 6. On a percentage basis, the term was mentioned on 18% (76 out of 432) of the earnings calls.
A total of 29 companies say the shutdown hasn’t really affected them. But some admitted that if it drags on (or had dragged on), they could start feeling some impact. 22 companies have already factored some impact, or the possibility of one, into their forecasts for Q4 or the full year.
Still, in comparison, it’s not a significant number when compared to the 500 S&P 500 companies. As a result, investors didn’t spend much time fretting over the longest shutdown.
Yet, now that it’s over, some short-term traders may be eyeing today’s level in the market as well as what the economic reports may reveal as data collectors inside the federal government begin releasing official numbers.
Since the April “Liberation Day” tariffs, pullbacks in the market have been short and shallow, with a decline of just 4.2% from an all-time high being the largest, according to LPL Research.
What has supported the market since mid-April?
An expanding economy, the AI boom, stable to lower interest rates, strong corporate earnings, and what may be best described as FOMO—fear of missing out—which has encouraged some folks to pile into stocks.
Market Summary
Two For The road
Over the last 30 years, the purchasing power of the US Consumer Dollar has been cut in half due to inflation. At the same time, the S&P 500 has gained 888% (8% per year) after adjusting for inflation. Is there another, better way to convince someone why they should invest their money? – Nick Murray, October 2025
“The truth of the matter is that you always know the right thing to do. The hard part is doing it.” - Norman Schwarzkopf
Please do not hesitate to contact me with any questions or concerns.
I hope you have a great week!
Warmest Regards,
Bill Stordahl, CFP®
Managing Director
Stordahl Capital Management
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