A closed sign is seen posted on barrier around the Lincoln Memorial in Washington, DC, on October 1, 2013. The US government shut down Tuesday for the first time in 17 years after a gridlocked Congress failed to reach a federal budget deal amid bitter brinkmanship. Some 800,000 federal workers have been furloughed in a move reminiscent of two previous shutdowns -- for six days in November 1995 and 21 days from December that year into early 1996. JEWEL SAMAD/AFP/Getty Images
WASHINGTON, D.C. - We are now at day seven of the government shutdown. On Oct. 17, the U.S. government will default on its debt if Congress doesn't increase the amount of money we borrow.
What happens if lawmakers can't reach a deal by October 17? Interest rates could spike. Stock and bond prices could drop. The value of the dollar could decrease internationally. There could be significant harm to the economy. However, financial experts say politicians cannot and will not let that happen.
"Right now, that's seen about as likely as the earth being wiped out by a giant asteroid," Financial Expert Michael Wittenberg said. "The normal fears that would come with insolvency would be skyrocketing interest rates. We've had none of that. Interest rates have been extremely stable. The stock market and the bond market are both indicating this is much ado about nothing."
So, what should you do with your investments? It's your decision, but experts say, historically, you should have nothing to worry about. When it's time to dip into your 401K, you probably won't even remember this crisis.
"In history, people who don't respond to a temporary, brief crisis, usually markets tend to go higher when a crisis ends than where they were before the crisis began," Wittenberg said. "This is an artificial, contrived, man-made situation. We have billions of dollars coming into the treasury every day."
In fact, several Wall Street experts who spoke to WFMY News 2's coverage partner, USA Today, said the chances of the government defaulting is zero percent. The consequences of not reaching a deal are just too great, they say.