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Shutdown Showdown of Your Wallet vs. Washington

The government just hit pause. Here’s what actually slows down, what doesn’t, and how to position so your money doesn’t take an unpaid furlough.

Author

Noah Zelvis
October 05, 2025

Congress missed the memo and the deadline. We’ve got a federal shutdown.

No need to panic-pack your portfolio, let’s walk through how this typically plays out, where it pinches, and how to set up smart, low-drama moves.

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What A Shutdown Really Means

Think of the economy as a busy airport. A shutdown doesn’t close the runway, but it does sideline crew. Hundreds of thousands of federal workers get furloughed (pay comes later), and essential folks still work but may not get checks until it’s over. That wait to get paid chill hits spending on everything from takeout to tires. The longer it lasts, the bigger the dent.

Meanwhile, your favorite economic scoreboards go dark. BLS pauses data collection and releases, so the jobs report and CPI could get delayed. Markets lean on private proxies (hello, ADP) and Fed surveys to fill the gap. So more rumor, less hard data, and bigger intraday mood swings.

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How Big Is The Hit?

History class time, 2013’s 16-day lapse knocked as much as 0.6 percentage point off annualized GDP that quarter, and  the 2018–19 partial shutdown clipped around 0.4 in Q1 before activity snapped back. 

Rule of thumb from big banks is roughly 0.15–0.2 off annualized GDP per week the lights are off. Most of that gets made up later when pay hits and contracts resume, but if it drags, small biz and contractors feel real pain, fast.

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Where You’ll Notice It (a.k.a. Real-Life Stuff)

  • Paychecks & purchases: Furloughed households cut back. Think fewer dinners out and delayed bigger buys. When back pay arrives, a mini catch-up bump follows.

  • Travel & parks: TSA and controllers keep working, but morale and staffing get tested. Expect sporadic delays. National parks mostly stay open, but services thin out. Tourism softens at the margin.

  • Permits & approvals: SBA loans, export certs, drilling permits, some grants and reviews stall. Government contractors may idle staff if they need on-site inspectors.

  • Data blackout: No official jobs report means markets trade on vibes. That boosts volatility into Fed-speak and any private data drops.

The Fed Angle: Cuts vs. Caution

We just got a quarter-point cut and the door cracked for more. The shutdown complicates things as softer spending and delayed data argue for patience, and sticky core inflation argues for caution. Chair Powell calls policy modestly restrictive, which is central bank code for we have room to cut again, but we’re not racing. If the shutdown skews data and dents hiring sentiment, October odds for another trim stay elevated. If inflation prints hot when the data backlog clears, December gets trickier.

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What This Means For You

  • Loans & rates: Credit card APRs and HELOCs usually nudge down a few cycles after a Fed cut. Mortgages key off longer yields, which can drift lower if growth fears flare. Have your docs ready; lock the dip beats try to bottom-tick.

  • Stocks: Choppier tape while the data is dark. Rate-sensitives and domestics hold an edge; companies relying on federal paperwork and park traffic can wobble.

  • Bonds & cash: Intermediates benefit if slowdown talk rises. Keep some short duration for flexibility, shutdowns end on a headline, and yields can snap back.

  • Small biz exposure: Contractors and firms tied to federal approvals may see near-term hiccups. Strong balance sheets matter more than ever.

Quick Playbook (because you’ve got a life)

  • Barbell it: Pair durable cash-flow names with selective cyclicals that benefit as rates step down.

  • Favor domestic supply chains: Fewer import headaches, fewer tariff shocks, less red-tape risk.

  • Own pricing power: If promo pressure increases and park traffic dips, the winners are the ones that can flex price without losing the customer.

  • Stage entries: Expect headline whiplash. Buy in slices rather than all at once.

But Does It All Bounce Back?

Usually, yes. Back pay hits bank accounts, delayed spending closes part of the gap, and the data catch-up wave resets the narrative. The risk is duration. A weekend tiff? Meh. Several weeks? Contractors, travel, and some consumer categories feel it. Keep powder dry, keep positions sized, and remember: the economy’s default setting is keep going.

Coffee-Napkin Takeaways

  • Shutdowns slow spend and stall data. The longer it lasts, the bigger the temporary dent.

  • Markets trade on proxies and speeches; volatility rises.

  • The Fed still has room to trim, but sticky core inflation limits the pace.

  • Play domestics, pricing power, and resilient cash flow; stage your buys.

Top Picks (fresh names, shutdown-savvy)

Booz Allen Hamilton (NYSE: BAH)

Booz Allen is the consultant’s consultant to defense, intel, and civil agencies. Shutdowns can delay new awards, but critical cyber, intel, and mission support typically continue, and backlogs tend to refill fast once funding resumes. BAH’s mix is skewed to ongoing programs rather than one-off grants, which helps revenue cadence. 

As rates drift lower, valuation risk eases, and hiring pipelines normalize. Think of BAH as a DC utility with steady demand, sticky relationships, resilient margins, and a long runway in AI-enabled analytics and cybersecurity once the lights come fully back on.

Tetra Tech (NASDAQ: TTEK)

TTEK lives at the intersection of water, environmental services, and infrastructure design, with a diversified client base across federal, state/local, and private sectors. Federal awards can pause during a shutdown, but state/local and commercial work keep the meters running, while the federal backlog usually re-accelerates post-reopening. 

The secular tailwinds (climate resilience, water treatment, grid and transmission planning) don’t care about short political squalls. Rate cuts help municipalities finance projects, and TTEK’s asset-light model supports high returns on capital through cycles.

Waste Connections (NYSE: WCN)

Trash still gets picked up during a shutdown. WCN’s route density, CPI-linked contracts, and pricing discipline make it one of the most defensive cash-flow machines you can own. If travel softens and park services wobble, household and commercial collection barely budge. Landfill scarcity underpins pricing; recycling and renewable natural gas add incremental upside. 

In a data-blackout, recession-whispers week, names like WCN trade like portfolio shock absorbers, and if the Fed keeps trimming, lower discount rates quietly lift the multiple.

Casey’s General Stores (NASDAQ: CASY)

When budgets feel squeezed or uncertain, value wins at the pump and in the c-store. Casey’s owns that Midwestern quick-stop niche with strong private-label (pizza still prints) and smart promo engines. 

A shutdown that delays paychecks nudges consumers toward convenience meals and bargain baskets; when back pay arrives, you get a mini-rebound in higher-margin prepared foods. Fuel volumes are resilient, and rate cuts help sentiment in rural housing and small-biz fleets. CASY isn’t glamorous. It’s reliable, cash-generative, and surprisingly nimble on price

Casey’s General Stores (NASDAQ: CASY)

When budgets feel squeezed or uncertain, value wins at the pump and in the c-store. Casey’s owns that Midwestern quick-stop niche with strong private-label (pizza still prints) and smart promo engines. 

A shutdown that delays paychecks nudges consumers toward convenience meals and bargain baskets; when back pay arrives, you get a mini-rebound in higher-margin prepared foods. Fuel volumes are resilient, and rate cuts help sentiment in rural housing and small-biz fleets. CASY isn’t glamorous. It’s reliable, cash-generative, and surprisingly nimble on price

Risk Management (two sips, three moves)

  1. Right-size positions in anything tied to federal approvals or tourism; trims > hero trades.

  2. Add in thirds on volatility. Headlines end shutdowns fast; don’t get caught all-in or all-out.

  3. Keep a bond ladder with some intermediate duration. If growth jitters pop, you’ll be glad you did.

If Washington wants drama, fine, but your portfolio doesn’t have to.

That’s it for today’s edition—thanks for reading! Reply to this email with any feedback or let me know which macro trends or markets you’d like me to cover next.

Best Regards,
—Noah Zelvis
Macro Notes