When Will the U.S. Government Shutdown Finally End?

Master, the U.S. government has now been shut down for 33 days since October 1st. It's just a few days away from the longest record in history (35 days). Federal employees are not receiving their pay, the food assistance program (SNAP) that 41 million people rely on has been suspended, and flight delays are rampant at airports. Politicians continue to blame each other, stuck in a deadlock with no compromise in sight.

When will this shutdown finally end? And what impact will its resolution have on the economy and the market? The three of us will delve into this critical issue.

Mew

Master, I will summarize the current situation. The U.S. federal government shutdown began at 12:01 AM (ET) on October 1, 2025, and has now lasted for 33 days. This is closely approaching the 35-day record set during the first Trump administration from December 2018 to January 2019.

Cause of the Shutdown:
The Republican-controlled House passed a temporary budget (CR, Continuing Resolution) on September 19 to fund the government until November 21. However, it has been blocked 13 times in the Senate by Democrats, leading to a stalemate. The Democrats have one demand: to include an extension of Obamacare (ACA) subsidies. These subsidies, temporarily expanded by the 2021 American Rescue Plan, are set to expire at the end of 2025, threatening to cause premium hikes for about 22 million people. Republicans insist on passing a 'clean' budget, arguing that "government operations and policy negotiations are separate."

Scale of Damage:

• Federal Employees: About 670,000 are on furlough, and 730,000 are classified as 'essential personnel' working without pay. Their unpaid compensation is accumulating at about $400 million per day.
• SNAP Food Assistance: Benefits for 41 million people were suspended on November 1. The Department of Agriculture (USDA) has about $5 billion in emergency funds, but the Trump administration refused to disburse it, claiming a "lack of legal authority." However, on November 1, federal judges in Rhode Island and Boston ordered the immediate use of these emergency funds, and on November 3, Treasury Secretary Scott Bessent announced he would not appeal. Still, it is expected to take time for full benefits to be distributed.
• Economic Loss: According to a Congressional Budget Office (CBO) analysis on October 29, a four-week shutdown would reduce real GDP growth in Q4 2025 by 1 percentage point, and an eight-week shutdown would reduce it by 2 percentage points. While most of this would be recovered after the shutdown ends, an economic loss of $7 billion to $14 billion would be permanent.

Key Deadlines:

• November 3 (Today): Partial SNAP payments may begin following the federal court order.
• November 4 (Tuesday): Gubernatorial election day in Virginia and New Jersey. Some Republican leaders expect Democrats to come to the negotiating table after the election.
• November 15: Next payday for active-duty military personnel. On October 15, the Trump administration used $8 billion in unspent R&D funds to make payroll, but it is observed that using the same method this time will be difficult.
• November 21: The original deadline for the temporary budget passed by the House. After this date, a new budget bill must be created.
• November 27 (Thanksgiving): The biggest travel season in the U.S. If absenteeism among unpaid air traffic controllers and TSA agents increases, it could lead to an aviation crisis.

Prediction Market Outlook:
Traders on the prediction market Kalshi expect the shutdown to last about 44 days on average. On Polymarket, 44% of traders are betting it will end after November 16. In other words, the market is pricing in the highest probability of an end in mid-to-late November.

As of now, both parties are engaged in a game of chicken with no signs of backing down. However, there are also reports of behind-the-scenes negotiations with some moderate Democratic lawmakers.

Kurumi

My Lord! Kurumi thinks this shutdown will end sooner than you think! In fact, this is close to a typical 'political show,' devilish!

First, the pressure points are approaching! The November 4th election, the November 15th military payday, and the November 27th Thanksgiving travel season. If any one of these blows up, politicians will face a massive public backlash! The Thanksgiving travel chaos was the final blow that ended the 2018-2019 shutdown. History repeats itself!

Second, both parties want to avoid a 'falling knife'! Polls show that voters blame Trump and the Republicans more, but the Democrats can't rest easy either. The suspension of SNAP benefits is also hitting the Democratic base. In the end, both parties are looking for a face-saving exit!

Third, White House Council of Economic Advisers Chairman Kevin Hassett said, "There's a chance it could end this week!" Of course, he said that on October 20th, so he was wrong, but this is proof that the administration also wants to end the shutdown quickly. Senate Majority Leader John Thune also optimistically stated that "Democrats will move after the November 4th election!"

Fourth, the SNAP court order could be a game-changer! A federal court ordered the immediate use of emergency funds, and the Treasury Secretary said he won't appeal. This means the Trump administration can no longer use the excuse that they "can't do it legally"! Once the biggest humanitarian crisis is mitigated, both parties will have a reason to come to the negotiating table!

Impact of Ending the Shutdown:
Once the shutdown ends, the positive effects will be explosive! The CBO said that "most of the GDP loss will be recovered." When 670,000 employees return to work, back pay is issued, and SNAP benefits resume, consumption will rebound sharply! The retail and travel industries could see huge benefits, especially if it ends in time for the Thanksgiving season!

The stock market will also cheer the "resolution of uncertainty"! The stock prices of defense, construction, and IT companies that rely on government contracts will rebound, and consumer goods companies will also benefit!

💖 Kurumi's Heart-o-Meter Score: 85/100

My Lord, politicians are ultimately afraid of voters! If this drags on right before Thanksgiving, both parties will have no choice but to surrender! Devilish!

Mikael

Kurumi, your optimism seems to oversimplify political reality. Human, I believe this shutdown could last much longer than Kurumi predicts. In the worst-case scenario, it could even extend into December.

First, the positions of the two parties are structurally incompatible. Republicans demand a separation of "government operations and policy negotiations," while Democrats are holding firm that there will be "no deal without an ACA subsidy extension." This isn't a simple budget fight; it's a clash of political philosophies. If Republicans accept the ACA subsidies, they will be accused by their core base of "saving Obamacare." If Democrats concede, they will be attacked for allowing the insurance premiums of 22 million people to skyrocket. For both sides, it's a matter of political survival.

Second, President Trump's actions cast doubt on his willingness to resolve the situation. He spent 14 of the first 31 days of the shutdown outside of Washington D.C. He has toured Malaysia, South Korea, and China, held a Halloween party at his Mar-a-Lago resort in Florida, and played golf. Previous presidents refrained from travel during a shutdown, but Trump is only applying pressure with the attitude that "it ends when the Democrats surrender." Furthermore, on November 2, he actually worsened the negotiating atmosphere by demanding that Senate Republicans "abolish the filibuster." Even Republican senators, including Senate Majority Leader John Thune, rejected this, revealing a crack within the party.

Third, the deadlines could actually prolong the stalemate. Kurumi said Democrats will move after the November 4th election, but the opposite could be true. If the election results are favorable for the Democrats, they might hold out longer, thinking "our strategy worked." If the results are unfavorable, they might maintain a hard line, thinking "we've already lost, so there's no reason to negotiate." As for the November 15th military payday, the Trump administration might find another workaround to pay them. That would blunt the pressure point.

Fourth, the SNAP court order is not a perfect solution either. Although the Treasury Secretary said he would not appeal, the $5 billion emergency fund is only enough for 60% of one month's benefits. The problem will resurface in December. And if the humanitarian crisis is partially alleviated by the court order, it might actually give politicians an excuse to drag their feet, thinking "we've put out the immediate fire, so let's negotiate slowly."

Fifth, the economic damage is accumulating. The CBO projected a permanent GDP loss of $14 billion from an eight-week shutdown. The morale of federal employees is at rock bottom, government contractors are on the verge of bankruptcy, and airport delays have already begun. If a Thanksgiving travel crisis occurs, they might rush to negotiate then, but the economic and social wounds incurred in the process will be difficult to heal.

Impact of Ending the Shutdown:
Of course, there will be a positive reaction in the short term when the shutdown ends. But that is 'recovery,' not 'growth.' The CBO said it too: "Most will be recovered, but $7 billion to $14 billion is a permanent loss." Moreover, the longer the shutdown lasts, the more the decline in federal employee morale, the collapse of trust in government contractors, and the contraction of consumer sentiment could become long-term issues. The stock market might also weigh "concerns about an economic slowdown" more heavily than the "resolution of uncertainty."

🚨 Mikael's Risk Score: 90/100

Politics is not a game of rationality. It's a game of pride and approval ratings. When both parties are obsessed with the idea that "we can't be the first to break," it is only the people who suffer.