With the US "opening its doors" imminent, cattle are expected to return soon.

Author: Techub Hotspot Express Written by: J1N, Techub News

The government shutdown, which has lasted for over a month, has negatively impacted many industries in the United States, prompting several US officials to sound the alarm about an economic downturn, and even affecting US military bases overseas.

The longest US government shutdown in history is finally coming to an end.

November 9th marks the 40th day of this shutdown crisis that began on October 1st.

The 40-day fiscal deadlock has suffocated global markets: US stocks fluctuated, gold fell, and Bitcoin briefly dropped below the $100,000 mark. Investors are anxiously waiting in uncertainty.

Source: Binance Until Sunday, the US Senate finally voted on the Republican-proposed temporary funding bill, advancing the bill by a 60-40 vote. Once the bill passes the House and is signed by the president, the government can reopen. According to the latest developments, a group of centrist Democrats have reached a preliminary consensus with Republicans: Democrats will support the government's reopening if Republicans commit to a vote on healthcare subsidies before December. The bill also includes a provision prohibiting federal agencies from laying off employees before January 30, which is seen as a key victory for federal unions. Eight Democrats defected, pushing through this bill that had previously been rejected 14 times, and market sentiment has subsequently improved. A National Shutdown: The past 40 days of shutdown have brought American society to a near standstill. Food safety inspections have been suspended, research projects have been forced to halt, and core agencies such as NASA and the Department of Homeland Security have entered "minimum operating mode." Logistics support for some overseas US military bases has been delayed, and even overseas military operations have been affected. Several US officials have warned that if the shutdown continues, the risk of economic recession will rise sharply, millions of federal employees will be furloughed or forced to work on pay leave, flight delays will be frequent, food safety risks will increase, national parks will be closed, and tax refunds will be delayed. This is not just an administrative shutdown, but a "chain reaction" across the economic system. The overseas impact is equally evident, with supply chain delays, order cancellations, and limited US military resupply weakening the US's global deployment capabilities. Behind what appears to be a political standoff, the entire economic machine is being forced to slow down. Consumer confidence has declined for three consecutive weeks, and the manufacturing PMI has fallen below the expansion/contraction threshold. Some state governments have been forced to prematurely utilize emergency reserves due to stalled funding, and the liquidity coverage ratio (LCR) of small and medium-sized US banks has fallen to its lowest level since October of last year. Goldman Sachs warned in its latest report that if the shutdown continues until the end of the year, US quarterly GDP growth will be dragged down by 1.2%, and the unemployment rate could climb to 4.5%. Risk premiums in financial markets have risen rapidly, leading to a further inversion of the US Treasury yield curve, and the market briefly anticipated a "technical recession." Why does the US government always "shut down"? The government shutdown was caused by Congress's failure to reach an agreement on the budget for the new fiscal year. On the surface, it was a budget disagreement; in reality, however, it is a microcosm of the polarization of American politics. Since 1976, the US government has shut down 21 times. If Congress fails to pass a budget or temporary funding bill before the end of the fiscal year (September 30), the government will be partially paralyzed. A list of federal government shutdowns since 1976 compiled by PBS shows that almost every president, from Reagan to Biden, has experienced a shutdown. 1981: The Reagan administration experienced its first shutdown, lasting only one day, but it marked the beginning of a long-term confrontation between Republicans and Democrats over fiscal and social policies. 1995-1996: During the Clinton administration, disagreements over healthcare reform and deficit reduction led to two shutdowns totaling 27 days, bringing the federal service system to a near standstill. 2013: During the Obama administration, Republicans blocked the Affordable Care Act (Obamacare), resulting in a 16-day government shutdown. The Dow Jones Industrial Average fell 2.6% during the same period, and the US GDP lost approximately $24 billion. 2018-2019: The Trump administration experienced a 35-day shutdown due to the budget dispute over the construction of the US-Mexico border wall, setting a record for the longest shutdown at the time. However, all three major U.S. stock indexes fell, with the Nasdaq plunging more than 10%, resulting in a GDP loss of approximately $11 billion. Now, this record has been broken by the shutdown in 2025. This impasse stemmed from disagreements between Republicans and Democrats over healthcare subsidies, the debt ceiling, and fiscal priorities. The 40-day shutdown plunged the U.S. into an unprecedented administrative freeze. FDA inspections were suspended, NASA missions were delayed, border controls were restricted, and flight delays were frequent. Economic losses alone have exceeded $50 billion. This recurring fiscal impasse is eroding global trust in the "American model." Bloomberg points out that over the past decade, the "shutdown cycle" in the U.S. has been shortening, and fiscal negotiations have become almost an annual event. International investors no longer view U.S. Treasury bonds as "absolutely safe assets," and some central banks have begun reducing their dollar reserve ratios. IMF Managing Director Kristalina Georgieva stated bluntly: "Political dysfunction in Washington is becoming one of the biggest sources of uncertainty in the global economy." What does a government shutdown have to do with the market? Many people ask: What does a government shutdown have to do with my stock or cryptocurrency trading? Actually, it has a huge impact. On the surface, it seems like just politicians arguing. But in reality, it directly affects the flow of funds in the market because it's not just a political shutdown, but a freeze in liquidity. Every government shutdown is a liquidity contraction. Suspended fiscal spending, federal payroll not being paid, and frozen funding programs mean that "money" is being withdrawn from the market. During the 2013 shutdown, the Dow Jones Industrial Average fell 2.6%, the S&P 500 dropped 3%, and US GDP lost $24 billion. The 2019 shutdown saw a sharp drop in US stocks and Bitcoin halved in value, falling from $6,000 to $3,000, due to the "cut-off" of liquidity. This year is similar. Since the "Black Friday" crash on October 11th, US stocks, gold, and Bitcoin have almost simultaneously plummeted. The Nasdaq fell 3.5%, the S&P 500 dropped 2.8%, gold fell from $4,300 per ounce to $3,900, and Bitcoin fell from a high of $126,000 to below $100,000, with a total market capitalization loss exceeding one trillion dollars.

Source: Coinglass

The reason is straightforward: the Treasury's General Account (TGA) balance surged from $800 billion to $1 trillion, meaning $200 billion in liquidity was "absorbed." Simultaneously, the short-term funding market tightened rapidly, with the overnight interbank lending rate (SOFR) soaring to 4.22%, exceeding the upper limit of the Federal Reserve's policy range; interbank lending costs rose, corporate financing tightened, and the Federal Reserve's "Survey Window" (SRF) saw a single-day usage of $50.3 billion, a new high since the 2020 pandemic.

Some analysts say that market liquidity decreased by nearly $700 billion in one month.

This is equivalent to the Federal Reserve raising interest rates "silently" several times. Compared to traditional markets, cryptocurrencies react faster and more amplify to changes in dollar liquidity. Stablecoin issuance decreased by about 8% during the shutdown, and daily transaction volume on the Ethereum network also fell to a new low for the year. Many institutions withdrew cash from risky assets and shifted to short-term US Treasury bonds and money market funds, creating a "safe-haven" trend. Even without the Federal Reserve's action, the Treasury's actions were enough to reshape market sentiment. Why did the market rebound after the "opening"? Every time the government reopens, the market almost always experiences a short-term rebound. The logic is actually very simple: "fiscal easing." When the shutdown ends, the government resumes operations, wages are paid back, budget spending restarts, and funds flow back into the market. The Treasury's general account (TGA) balance begins to decline, and liquidity within the Federal Reserve system returns to the financial system, naturally causing a "recovery" reaction in the market. Historically, several typical government shutdowns have confirmed this pattern. In 2013, after the government reopened, the Dow Jones Industrial Average rose 3.5% in just two weeks; in 2019, when the shutdown ended, US stocks experienced a quarterly rebound, and Bitcoin also resumed its upward trend. What the market fears most is never bad news, but uncertainty. When funding plans are passed and fiscal order is restored, confidence returns, and risk assets are immediately supported. This time is no exception. With the Senate passing the bill, US stock futures rebounded by 1%, and Bitcoin climbed back above $106,000. Investors are betting that the government reopening means a new round of fiscal stimulus is about to begin, especially for technology stocks and crypto assets, which will be the most direct beneficiaries. Morgan Stanley pointed out in a report that in the first two weeks after a shutdown ends, US stocks rise by an average of about 3%, but then often enter a consolidation or correction phase. Because the market's anticipated "quantitative easing effect" was quickly priced in, while the actual implementation of fiscal stimulus still requires several weeks. In other words, the government's "opening" only provides a short-term respite and cannot fundamentally change the structural predicament of US finances. "Closing" has become a chronic disease of US finances. However, this cycle of "opening—closing—opening again" has long been a chronic problem for US finances. By 2025, the total US national debt will exceed $36 trillion, approximately 130% of GDP. Interest payments alone will reach $1 trillion annually, almost half of the defense budget. The massive debt leaves increasingly less room for fiscal maneuvering, making each budget negotiation akin to walking a tightrope. Republicans advocate spending cuts and tax reductions to stimulate the economy, while Democrats emphasize expanding social welfare and green investment. The differences between the two sides continue to widen, with the debt ceiling repeatedly used as a bargaining chip in political games. Politicians have gained the power of discourse, but have lost the trust of the market. Rating agencies have repeatedly warned that the US sovereign credit rating may be downgraded due to political uncertainty. Long-term Treasury yields have risen from 4% to 4.5%, further increasing financing costs and creating a vicious cycle. At the same time, the trend of "de-dollarization" is accelerating, with more and more institutional investors increasing their allocation to non-sovereign assets such as gold and Bitcoin to hedge against potential fiscal risks. In the cryptocurrency market, stablecoin trading volume has surged, and DeFi protocols are becoming new financing channels. To some extent, the credit fluctuations of the US government are invisibly driving the restructuring of the global financial system. In conclusion, the US government's "shutdown" is never just a political drama; it is essentially a game about currency, liquidity, and global credit. When the lights in Washington go out, fiscal spending halts, and liquidity is locked in the national treasury, US stocks fall, gold comes under pressure, and Bitcoin sneezes. But when the government "opens the door," and the lights come back on, the market immediately feels the return of liquidity. In today's global financial system, the impact of a budget negotiation is no less significant than that of a Federal Reserve interest rate hike. This is because it directly controls the "capital valve" and determines global risk appetite. So next time you see the words "government shutdown," don't assume it's just a congressional farce. It may be the prelude to the next global market turmoil. When Washington holds its breath, global capital holds its breath too. In this interconnected financial era, politics and markets are already intertwined. The US "shutdown" game also reminds us: when the world's central banks shut down, everyone has to navigate in the dark.