Personal Wealth Management / Expert Commentary

This Week In Review | US Gov't Shutdown, French Politics, Gold

The economy and markets can feel dizzying and ever changing. That’s where we can help. Fisher Investments’ “This Week in Review” is a weekly segment designed to highlight a few things you may have missed this week, what they could mean for financial markets and why they matter to investors like you.

This week, we’ll be covering:

  • What the ongoing US government shutdown might mean for stocks
  • French political uncertainty continues
  • Gold sets new all-time high

Want to dig deeper?


Have feedback? Share your thoughts on this episode in just 1 minute by filling out this survey: https://fi.co1.qualtrics.com/jfe/form...

Transcript

Tim Schluter:

Hello, and welcome to This Week in Review.

This weekly segment is designed to highlight a few important developments you may have missed this week, what they may mean for markets, and most importantly, the potential impact for investors. To stay up to date with our latest market insights, subscribe to our YouTube channel or visit FisherInvestments.com. Now, let's review what happened this week.

First, the US government shutdown continues.

The US government shutdown continued into this week as a congressional funding deal has remained elusive. As discussed in last week's episode, a government shutdown forces some federal employees into unpaid furloughs, while others deemed 'essential'— such as air traffic controllers and law enforcement personnel— continue working without pay until the government reopens. The resulting uncertainty and hardship for federal workers is significant, and we empathize with those affected. But financial markets tend to focus on the broader economic implications rather than the immediate human impact.

While the standstill in Washington may be frustrating for many voters, history shows government shutdowns are not inherently harmful to the economy or stock market. Although shutdowns can temporarily affect sentiment, stocks typically move on quickly. Regarding the Trump administration's layoff plans, it's unclear whether these are a negotiating tactic. And even if additional federal layoffs occur, federal employees account for less than 2% of the US workforce. While layoffs would undoubtedly disrupt the lives of those affected, they're unlikely to significantly impact the broader US employment landscape. We will continue to monitor the current shutdown, but history suggests that markets are resilient in the face of such events, and we don't expect this episode to disrupt the ongoing bull market.

Next, France's prime minister resigns.

On Monday, France's recently appointed prime minister, resigned after less than a month, the shortest tenure in the history of France's Fifth Republic and the fourth prime minister to step down in just over a year. The departure occurred after the Prime Minister was unable to rally enough support in the French parliament to establish a government cabinet. This latest resignation highlights the ongoing political gridlock in France, as fragmented minority parties in parliament remain unable to agree on the 2026 budget.

While the revolving door of leadership and budget disagreements present challenges, financial markets tend to look past political drama, focusing instead on broader economic trends. France's markets have weathered similar turbulence before leadership changes and budget disputes are not new, and markets have historically shown resilience. In fact, such instability often dampens sentiment, creating opportunities for positive surprise.

France's president faced a familiar choice appoint yet another prime minister or call snap parliamentary elections, and he decided to name a new prime minister. We believe the likely result of all of this is another weak government, whether it's a minority administration, fragile coalition or caretaker government. Taking a step back, we believe concerns over France's budget challenges appear overstated. Importantly for investors, markets seem to have already priced in the uncertainty, setting the stage for French and European economies to potentially outperform lowered expectations.

Finally, gold hits a new record high.

On Tuesday, gold hit a historic milestone, reaching an all-time high of $4,000 per troy ounce. Often celebrated as a safe haven asset, gold's price has surged amid growing economic uncertainty, escalating geopolitical tensions and persistent inflation fears. While gold's appeal can be tempting, the precious metal does come with notable downsides as a long-term investment. Despite some impressive rallies, gold has also experienced prolonged periods of flat performance. Given gold generates much of its returns in short periods. it requires excellent market timing, which is nearly impossible, in our view. Over the past 80 years, gold has delivered an average annual return of just 5.5%, about half the return of global stocks during that same period. Lower returns might be acceptable if gold were significantly less volatile than stocks, but that's not been the case.

Gold prices have historically been more volatile than equities, reflecting the fact that it's a commodity rather than a company. Unlike companies which can innovate, adapt and grow, gold has no connection to economic growth or exposure to innovation. Gold's behavior is also unpredictable. While it's often seen as a defensive asset, it hasn't consistently provided protection during market downturns. For instance, during bear markets in 2022, 2020 and 2008. Gold fell alongside stocks, failing to deliver the expected safety net many may have assumed. Ultimately, we believe long-term investors are better served by viewing gold for what it is, a commodity with limited capacity to hedge against inflation or volatility and significantly lower return potential compared to stocks.

That's it for this week.

Thanks for tuning in to This Week in Review. If you're looking for more insights, then don't miss our other series, 3 Things You Need to Know This Week, released every Monday. You can also visit FisherInvestments.com any time for our latest thoughts on markets. Thanks again for joining us, and don't forget to hit like and subscribe!

The definitive guide to retirement income.

See Our Investment Guides

The world of investing can seem like a giant maze. Fisher Investments has developed several informational and educational guides tackling a variety of investing topics.

Learn More

Learn why 190,000 clients* trust us to manage their money and how we may be able to help you achieve your financial goals.

*As of 9/30/2025

New to Fisher? Call Us.

(888) 823-9566

Contact Us Today