New York (HedgeCo.Net) - The U.S. Federal Government has been shut down for the first time in 17 years. Reuters reports that: “A shutdown would not mean a financial free-for-all.” It does however, mean that there are less people in place to review applications to register shares with regulators, including initial public offerings, or offer new financial products, Reuters says. This includes new regulation under the JOBS Act.
“If the budget stalemate in the U.S. Congress leads to an extended federal government shutdown, investors can expect potential interruptions to financial product approvals and new rules, though market oversight would not grind to a halt.” Reuters says.
The SEC would still have an eye on exchange activity, potential insider trading and money market funds. ”The SEC will remain open and operational in the event the federal government undergoes a lapse in appropriations on October 1. Any changes to the SEC’s operational status after October 1 will be announced.” The SEC said.
In U.S. politics, a government shutdown is a situation in which the government stops providing all but “essential” services. Typically, federal services that continue despite a shutdown include the National Weather Service and its parent agencies, medical services at federal facilities, the postal service, armed forces, air traffic management, and corrections (the penal system). A government shutdown is similar to a lockout in the private sector.
President Barack Obama will deliver a statement from the Rose Garden at 12:25 p.m., where he was expected to both address the shutdown and the opening of enrollment for health insurance exchanges under his signature health care law.
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