CHART OF THE DAY: When People Lose Confidence In Their Government

For all the focus on manufacturing, economies in most developed nations are more than 60% services.

Services rely on confidence.

So as the US Government shutdown drags into its second week and important talks between Senate leaders Reid and McConnell end overnight without a resolution, the negative economic impact of the shutdown builds.

No more starkly is this in evidence than the daily Gallup Consumer Confidence in the US that Justin Wolfers shared on Twitter.

The only difference between this collapse in confidence and the two previous big collapses (2009 and 2011) is that equities at these times were under pressure as well.

Lawmakers on Capitol Hill are really testing the recovery and even though US stocks were higher again overnight, uncertainty has been ingrained in the psyche of US consumers, international investors and most likely policy-makers at the Fed.

Stock market and US Dollar bulls have been warned.

Follow Greg McKenna on Twitter.

Follow Business Insider Australia on Facebook and Twitter

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at