Partial shutdown was announced earlier today after the two Congress houses’ failure to compromise a new budget. Not only does this seem to have shaken the U.S., but it is also subsequently threatening world economics. On the U.S. socio-economic scale, over 700 000 U.S. federal employees currently face unpaid leave without any guarantee of receiving back pay after deadlock is over; as well, other staff  severely affected include the department of energy, health of human services, education and more. So what does this mean for the rest of world? As suggested by Goldman Sachs, an American multinational investment banking firm, the effect of the current deadlock can cause a hefty decrease of 0.9% from the U.S.  GDP in this quarter. To make matter worse, the U.S. is also about to undergo the “debt ceiling”, where it will exceed its borrowing limit to pay its bills. Not only will this have a large potential in depreciating many foreign external values, but it may also become a contributing factor to the existing world recession as America’s GDP and demand for consumption continue to fall.

Youtube Video: BBC News: How will the US government shutdown affect the economy

Sources: http://www.bbc.co.uk/news/world-us-canada-24343698
https://www.youtube.com/watch?v=MLIy_Iw35hQ