Good morning. The US government shuts down, and we dig into what's actually closed. Investors are piling into gold again. And why AI could be different to previous bubbles.... Listen to the day's top stories.
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The USgovernment began the first shutdown in nearly seven years (and the third under President Donald Trump), disrupting hundreds of thousands of jobs and upending many public services. Here's the text of the shutdown memo. Democrats and Republicans have shown no signs of resolving their deadlock, with the Trump administration using federal websites and employee email lists to spread a simple, but controversial, message: Blame the Democrats.
Markets are broadly pulling back, with traders voicing worry that government shutdown could delay Friday's jobs report. Some are even saying it could stretch all the way to the Federal Reserve's next meeting on Oct. 29. Gold posted another all-time high and is on track for an annual gain of almost 50%, while the dollar is under pressure again.
JOIN THE DISCUSSION: Hours after the US government shut down, what are we watching from Wall Street to Washington? Bloomberg journalists will answer your questions in a Live Q&A today at 10 a.m. EDT. Stream here.
Ivy League update: President Trump is close to finalizing a deal with Harvard University that could defuse one of the highest-profile fights between his administration and US higher education. Over in New Haven, Yale is cutting costs and offering retirement incentives to prepare for higher taxes on its endowment income and reduced federal funding.
Taiwan pushed back hard on a US request to move chip production stateside to cover half of America's demand. "This issue was not discussed in this round of negotiation, and we will not agree to such a condition," Vice Premier Cheng Li-chiun said. Meanwhile, Intel said it remains committed to plans for a sprawling chip manufacturing plant in the politically important state of Ohio.
Corporate roundup: Nike's turnaround efforts are starting to pay off with better-than-expected sales, thanks to its focus on running and basketball. After another dismal quarter, Novo Nordisk investors are looking to a pill form of semaglutide, which is being tested as a potential treatment for Alzheimer's disease.
Deep Dive: The Anatomy of a Shutdown
Shutdowns have different effects on government services based on their timing and duration — and on the existing funding that agencies have once the annual spending authority runs out. Typically speaking, the longer it goes, the worse it gets.
For a synopsis of the shutdown's key impacts, click here.
Less than a third of federal employees are likely to be furloughed during the shutdown, according to a review of agency contingency plans. That's less than previous shutdowns, when about four in 10 federal workers were sent home.
The closure will curtail or halt some US climate disaster preparedness and environmental programs, including the National Flood Insurance Program.
A couple of positives: the NOAA will still provide forecasts and issue safety warnings, as weather forecasting is seen as essential for public safety. And National Park Service leaders have been told to keep most parks open, with park roads, lookouts, trails, and open-air memorials remaining accessible.
The Big Take
Yoshiaki Murakami at a 2006 press conference, where he admitted to insider trading charges he later unsuccessfully challenged. Photographer: Yoshikazu Tsuno/AFP/Getty Images
Japan's activist investor Yoshiaki Murakami has reignited his campaign to force corporate Japan to boost stock valuations and return capital to shareholders. His confrontational tactics reflect a shift in the country towards greater shareholder power and pressure on asset-heavy, undervalued firms.
Sam Altman, CEO of OpenAI. Photographer: Kyle Grillot/Bloomberg
If artificial intelligence really is a bubble, we need to work out how bad things could get if it bursts. As someone who lived through the dot-com bubble and burst, John Authers writes, this one feels different to that. Back then, optimism abounded. But this time, excitement over AI feels like a collective grasp for a lifeline.
A U.S. penny sits next to coin blanks on a press in Pennsylvania. Photographer: Bloomberg Creative Photos/Bloomberg
Pennies out, nickels in. Retailers are pushing Congress for a law to round cash purchases to the nearest nickel. The proposal would only affect physical money—cards and digital payments stay exact. Supporters say it'll simplify transactions and save costs, while critics warn of a potential "rounding tax" for cash users.
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Risk assets are still climbing — but how long can the rally last before the downturn begins?
Join Henrik Zeberg, Swissblock's Head Macroeconomist, for an exclusive Live Q&A session where he'll break down the late-stage dynamics of this bull market and answer your questions directly.
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We'll select some of the most relevant questions to be answered live during the webinar
In this live session, we'll unpack the current regime through the lens of our proprietary Hawkeye Framework— the same 3-layer system that powers all Swissblock reports, combined with classical economic theory and Henrik Zeberg's proprietary multi-layered market model.
In the meantime: If you missed our last session "Live Q&A Fed's Cutting Phase: What Happens Next to Economy and Markets?", you can watch the full replay now on our YouTube channel:
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