Shutdown Strife Is Just the First Domino

Shutdown Strife Is Just the First Domino

This is not about politics. It’s about the playbook.

On October 1, a TSA agent walked into Dulles Airport for another shift. He showed up like always. Except this time, his paycheck didn’t.

Congress failed to pass a budget. The government shut down. Hundreds of thousands of federal workers were left without income. Many still had to report for work. No pay. No timeline. No answers.

To most, it looks like a national crisis.

To a few, it looks like a repeat of a profitable pattern.

Every shutdown ends the same way. Not with spending cuts. With more spending.

And in this economy, that means one thing: more liquidity

The Real Cost of the Shutdown

Right now, 750,000 federal workers are furloughed. Essential employees like air traffic controllers and FBI agents are working without pay.

National parks are closed. Government services have stalled. Even the monthly jobs report has been frozen.

According to the Congressional Budget Office, this shutdown is costing the economy about $400 million in wages every day.

The labor market was already showing signs of weakness. Only 22,000 jobs were created in August. That’s the lowest number in years. Unemployment ticked up to 4.3 percent. Consumer confidence is slipping.

Add in a prolonged shutdown, and that weakness turns into something worse. But here’s what matters:

When the pain becomes political, Congress opens the floodgates.

And that’s when the real opportunity begins.

Every Shutdown Ends the Same Way

We’ve seen this before.

In 2013, the shutdown lasted 16 days. It ended with a bipartisan deal and a surge in spending. In 2019, the longest shutdown in U.S. history dragged on for 35 days. It ended with a deal that included back pay and larger agency budgets.

Even the 2023 debt ceiling standoff didn’t lead to cuts. It ended with increased spending caps. So what happens next?

Congress gets scared.

They rush to pass a funding bill.

Government workers get their money.

Agencies spend to make up for lost time.

And markets rip higher on the liquidity.

This is not a theory. It’s a pattern.

Short-Term Crisis. Short-Term Cash.

When this shutdown ends, it won’t be with restraint. It will be with cash.

There’s too much political pressure to do anything else. Nobody wants to be blamed for keeping workers unpaid or services offline.

And when that spending kicks in, it does three things:

Yes, it adds to the deficit. Yes, it adds inflation pressure. But none of that shows up right away.

In the short term, this will look like a recovery.

Markets will cheer. Risk assets will rally. Spending will pick up. The media will call it resilience.

The people who prepared will quietly make money. The ones who panicked will be left watching.

The Bigger Problem That Nobody Fixes

Zoom out, and the story is less encouraging.

Each time Washington breaks something, it patches it with more spending. And each time, that spending sets a new baseline.

Over time, the economy becomes addicted to these injections. The dollar weakens. Deficits grow. Inflation creeps in. Trust erodes.

But those long-term problems don’t stop the short-term rally.

In fact, they usually fuel it.

Because as credibility fades, the only lever Washington can still pull is the money lever. And every time they pull it, it creates another wave of opportunity for the few people who see it coming.

Here’s What to Watch Next

The opportunity is not in the shutdown. It’s in how the shutdown ends.

Watch three things:

This will show you where the next wave of cash is headed. And if you position before it hits, you don’t need to guess. You just need to be there when it arrives.

The Decision Point

Most people will sit this out.

They’ll wait for Washington to “fix it” and think the crisis is over. They’ll miss the fact that the fix is the real opportunity.

A few will see it for what it is. A trigger. A setup. A window that doesn’t stay open for long.

Every shutdown ends with more money.

It’s not a flaw in the system. At this point, it is the system.

So the only question that matters is this:

When the deal is done and the money flows, will you be watching the bounce… or riding it?

That’s the edge.

Stay Sharp,

Gideon Ashwood