Financing Expert Alec Sohmer Responds to Possible Government Shutdown

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Following an article published by CBS Boston, financing expert Alec Sohmer comments on how the impending government shutdown could affect workers and investors.

Financing expert Alec Sohmer responds to an article published by CBS Boston, which details the implications of a government shutdown, including how it could hurt investors and average workers.

According to the CBS Boston article published on September 24th titled “Behind the Mic with Joe Mathieu: How Gov’t. Shutdown Could Hurt You,” the future of the budget standoff in Congress is still uncertain. However, the article says the longer it takes to reach a compromise, the more damage it could cause to average workers and investors. If a government shutdown lasted longer than a week, it could be detrimental to the economy.

As stated in Congress by Mark Zandi of Moody’s Analytics, a shutdown lasting three or four weeks has the potential to squash economic growth by 1.4 percent. Since the budget squabble began, Wall Street has already seen a decline in the stock market.

Alec Sohmer, a financing specialist and managing director at Plymouth Rock Capital, says the government shutdown could cause businesses to pull investments in order to protect themselves, negatively impacting the average worker. However, Sohmer says the shutdown is unlikely. “Businesses might cancel investments and pull out their shares to protect their assets from a steep economic downturn,” he says. “An act like this could trickle down the line, greatly affecting the average worker and possibly increasing the unemployment rate. No one is going to hire people in a declining economy. Fortunately, I don't think it will come to a shutdown. Typically, lawmakers will reach a decision right before the deadline.”

Even with the threat looming, Sohmer predicts the market to pick up again. “As showed in the most recent past, government shutdowns rarely last too long before both parties reach a deal,” he says. “Some investors might flee due to uncertainty, but it should be less significant to the market. Last year after an eleventh hour government decision regarding the fiscal cliff the market recovered, showing a 22 percent increase this year for the S&P 500 alone.”

Alec Sohmer, a strategic financing leader and co-founder of Plymouth Rock Capital, has 20 years of Board-level experience. He has served in many interim management positions for businesses requiring significant turnaround or restructuring. He is able to increase revenue streams by utilizing a variety of line management techniques. In his two decades of experience, he has dramatically increased revenues of businesses by identifying untapped markets.

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Scott Darrohn
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since: 08/2013
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