On Thursday the House and Senate passed a Continuing Resolution (CR) and sent it to the White House pushing the government shutdown deadline from October 1, until December 3. The hope is that in the next two months Congress can agree on spending for the various departments of government and pass regular appropriation bills. Under a CR spending is frozen at current year levels and from defense to health research there is general agreement that funding priorities need to be adjusted for the current year.

For financial markets, probably the biggest news was the official notification to Congress by Treasury Secretary Yellen that October 18 is the drop dead date for the government needing to borrow in order to have the cash to pay bills. As of today the Congress has no game plan to raise or suspend the ceiling. Senate Republican Leader McConnell has said Republicans will not provide any votes to deal with the debt ceiling; but when Democratic Leader Schumer tried to pass a suspension of the ceiling with just Democratic votes McConnell and his Republican colleagues raised the bar by filibustering the bill. Under Senate rules what this means is that not only do the Democrats have to supply the 51 votes to pass a bill; but they need 10 Republicans to stop the filibuster. With Republi...

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