Pop quiz for all you economy-watchers out there:  What are the current US levels of . . .

  1. Unemployment?
  2. CPI?
  3. Retail Sales?

The answers?  We don’t know.  Nobody knows. 

That’s because one of the side effects of the government shutdown is that the departments that collect and publish economic information have not been.  The Bureau of Labor Statistics (BLS), which publishes payroll numbers as well as two of the most widely-followed inflation measures, CPI and PPI,  was closed for the duration of the shutdown.  And the Bureau of Economic Analysis (BEA), which publishes GDP, personal income, and a variety of other data, was  also shuttered.

If you’re wondering what this means for the economy and markets, consider this: A month ago, all eyes were on the Federal Reserve, and all discussion was focused on when they would begin to taper their bond purchases and by how much.  Were enough jobs being created?  Were there signs of inflation on the horizon?  How strong is US growth, and is it sufficient to support removing accommodation?  Would the Fed move in December?  2014?

And then the US government shut down, and suddenly no one was talking about the Fed anymore.   All focus shifted to the impact of furloughed workers on economic growth, and when Congress might raise the debt ceiling, and whether the Treasury would default on its debt.

But while the Fed discussion may have been temporarily moved to the back burner, it’s as important as ever in terms of influencing investment decisions.   The information vacuum created by the shutdown not only makes it very difficult for investors to see how the economy is doing, it makes it impossible to project the next move of the Federal Reserve.  For weeks we have been unable to observe growth, inflation, jobs and other metrics the Fed will use to assess when to taper their bond-buying program.

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