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How the government shutdown impacts the U.S. economy

admin - Latest News - November 4, 2025
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The U.S. is inching toward the longest government shutdown in American history. NBC News’ Brian Cheung explains how shutdowns impact the U.S. economy.



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Savewith a NBCUniversal ProfileCreate your free profile or log in to save this articleNov. 3, 2025, 12:00 PM ESTBy Chantal Da SilvaThe blocks are concrete — but little else about Israel’s “yellow line” appears to be. Israeli troops have laid yellow blocks down on the ground in Gaza, marking the parts of the Palestinian enclave — just more than half of the territory — still under their control as part of the ceasefire with Hamas.Envisioned as a temporary boundary under the first phase of the agreement, which was brokered in part by President Donald Trump, the line has instead become a flashpoint. Israel carried out days of strikes on Gaza last week despite the truce, killing more than 100 people, including dozens of children, according to the Palestinian Health Ministry in Gaza, Israel said it was responding to what it said was a Hamas attack that killed one of its soldiers operating within the “yellow line.” Hamas denied involvement. Israeli forces had earlier separately opened fire on Palestinians in incidents in which it said people neared or crossed the boundary line prior to physical barriers being put in place.The next stages of Trump’s plan that would see Israel withdraw further are still to be negotiated. Israeli Prime Minister Benjamin Netanyahu’s office said Monday that he met with senior White House officials to discuss efforts to further implement Trump’s 20-point plan. Analysts warned that with the future of the truce appearing to be on “shaky” ground, it could be some time before there is clarity.NBC News spoke to some Palestinians whose homes, or what’s left of them, lie just beyond the barrier. For them, the line has become a physical manifestation of their fears that they may never be able to return to their land.’I can’t even look at it’The Israel Defense Forces began laying the yellow markers last month in what the military said was an effort to clearly delineate the areas it had agreed to withdraw to under the ceasefire deal with Hamas, which came into effect Oct. 10. It came after repeated incidents of Israeli forces firing upon Palestinians who they said had approached or crossed the withdrawal boundary, dubbed the “yellow line.” In one case last month, the Gaza Civil Defense agency said Israeli forces had killed nine people in a bus. The Israeli military said troops initially fired warning shots at the vehicle, which it said had crossed the boundary, and then “opened fire to remove the threat” when the vehicle didn’t stop.
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Oct. 14, 2025, 6:26 PM EDTBy Daniella Silva and Natasha KoreckiCHICAGO — A teacher said tear gas drifted toward a school playground, forcing students and recess indoors. A viral video recorded near another school showed law enforcement dragging a woman out of her van and onto the ground. And students say they have seen ICE vehicles in their neighborhoods, leading them to feel frightened, according to one instructor. Educators say those incidents and others that have taken place as federal immigration agents increase arrests in Chicago are disrupting their jobs, upending their communities and traumatizing their students.“Everyone’s very anxious,” said Sheena Shukla, a school social worker for Chicago Public Schools. “Can you imagine telling a 12-year-old that people are out there who might want to take their family? We can’t shield our children from these realities, so we provide them with a level of support that they can understand.” In response, school staff members have organized teams to report and respond to Immigration and Customs Enforcement activity around their schools, including patrolling the area, keeping concerned parents informed and helping escort some families to and from school, according to members of the Chicago Teachers Union. That work includes talking to their students in age-appropriate ways about what’s going on in their communities in a city that is nearly 30% Latino and more than 22% foreign-born, Shukla said.Armed federal agents clash with protesters in Chicago03:13The Chicago Public Schools district is holding daily calls with city leaders and its labor partners. It said in a statement to NBC News that while there has been law enforcement activity near some schools, there have been no incidents inside its schools and facilities. Nonetheless, the district and the Chicago Teachers Union have been issuing guidance and taking steps in preparation for federal immigration enforcement since President Donald Trump returned to office in January.“School remains the safest and best place for students. CPS staff have safety protocols, including how to respond if federal representatives seek access to school property or interaction with students or staff,” the district said.The district has also been vocal about the fact that it does not collaborate with federal immigration enforcement agencies, including ICE. Agents will not be granted access to its schools unless they present a “valid criminal judicial warrant signed by a federal judge,” the district said in its statement.The Department of Homeland Security referred NBC News to a statement saying ICE does not target schools or children. “ICE is not going to schools to make arrests of children. Criminals are no longer able to hide in America’s schools to avoid arrest. The Trump Administration will not tie the hands of our brave law enforcement and instead trusts them to use common sense,” DHS spokeswoman Tricia McLaughlin said in the statement. “If a dangerous illegal alien felon were to flee into a school, or a child sex offender is working as an employee, there may be a situation where an arrest is made to protect public safety. But this has not happened.” On Tuesday, DHS said on social media that its enforcement surge in the area, known as Operation Midway Blitz, “is making Illinois SAFE again” and had arrested over 1,500 people across Illinois, including criminals and gang members.Last week, Chicago Teachers Union officials met with about a dozen teachers at Funston Elementary School to talk about a recent incident involving immigration officials and tear gas being deployed near the school.More on immigration enforcement in IllinoisHow immigration enforcement turned sleepy Broadview into a chaotic, militarized townIllinois officials issue orders and file lawsuits as protesters clash with immigration agentsBodycam videos show ICE agents’ initial reactions to fatal Chicago shootingIllinois Gov. JB Pritzker calls armed immigration officers in Chicago an ‘attack on Americans’Maria Heavener, a first grade teacher at the school, described how she was teaching on Oct. 3 when she heard what sounded like helicopters, horns blowing on the street and a whistle educators used to announce ICE activity. She then saw a message from a fifth grade teacher at the school who spotted ICE “less than 100 feet from our building” while walking to a store called Rico Fresh Market for lunch. “Tear gas filled the streets, blowing into the parking lot of Rico Fresh and towards the direction of our playground across the street,” Heavener said at a news conference with Chicago Mayor Brandon Johnson.A class that had been outside was quickly pulled inside so it was not affected by the tear gas, Heavener said. The school said in a letter to families that it held recess indoors for the rest of the day out of an abundance of caution and that staff members were well-versed in the protocols for keeping students safe.By dismissal time, about 100 community members were lined up and down the streets near the school, “creating safe passage for our children and families and sending a clear message that ICE is not welcome in our community,” Heavener said.DHS did not respond to a request for comment about enforcement activity and deploying tear gas near the school or concerns about using chemical agents near schools.“There is no institution available right now that is constructed to deal with the trauma, the impact that our young people and their families and our communities are experiencing,” CTU President Stacy Davis Gates said.Heavener and other school staff members told NBC News they have seen a drop in attendance as the immigration enforcement operations have increased. “Some families and students, they’re not leaving the home,” said Shukla, the social worker.Videos of apparent immigration enforcement activity around the city have kept teachers on high alert, including a recent viral post showing federal agents taking a woman out of her car and putting her on the ground while they were detaining her. The person who recorded and posted the video said that she is a teacher and that the incident took place near the school they work at during dismissal as parents were picking up their children. The teacher claimed she heard students shouting “It’s ICE!” and running away. NBC News could not independently verify the details described in the post, and the poster of the video did not immediately respond to a request for comment. DHS said in a statement about the incident that while it was conducting targeted immigration enforcement operations, Border Patrol was “harassed and recklessly followed by agitators with megaphones and whistles who began to yell inflammatory remarks and alerted the public of the officers’ presence.”“They were driving recklessly, including weaving between lanes and putting other motorists at risk. Following the driver abruptly stopping in the middle of traffic near a school, law enforcement approached the vehicle,” McLaughlin said. “The occupants refused to exit the vehicle and follow law enforcement commands.”She said the people in the car were two immigrants in the country illegally from Mexico but did not identify them or specify whether they were detained.A teacher at a school in Englewood, a neighborhood in Chicago’s South Side, told NBC News that students have reported witnessing ICE vans near their homes or driving by during recess. The teacher said that during a check-in with a seventh-grade class, a student said “she was feeling sad because she witnessed somebody getting abducted by ICE. Immediately, the entire class just became a discussion of ICE activity.” The teacher, who asked to remain anonymous because of fears that federal immigration agents could target his school community, said some of his students’ family members have been arrested by immigration agents.“It ripples out. Now there are other students who are missing their friends,” he said. Heavener said her young students have a hard time comprehending what is going on.When school returned the Monday after the incident near Funston Elementary, Heavener said, she asked her first grade class how they were feeling and whether they had questions about what happened.Some were confused, and others “knew exactly what Immigrations and Customs Enforcement was, they knew what a tear gas canister was.”“They were telling me that they feel sad and they feel scared. It doesn’t make sense to them,” she said. “In social studies, we’re also doing a unit on community, about getting along with others, about rules and laws, about citizenship and respect, and they’re seeing all of these things be violated in real time. The things that they’re learning and the things that they’re seeing outside of the window don’t line up.” Heavener asked students to share a word that described how they felt. Most said “scared” or “worried.” Then one student said they felt brave, she said.The student said, “I feel brave, because at the end of the day, did you see how many neighbors were outside? They were there to keep us safe,” she recounted.“Then another kid, encouraged by that, said: ‘I feel confident, because I know school is the safest place to be. My mom was telling me that school, they can’t come into our school,’” Heavener said. “I think that is also what gave me hope in the moment.”Daniella SilvaDaniella Silva is a national reporter for NBC News, focusing on immigration and education.Natasha KoreckiNatasha Korecki is a senior national political reporter for NBC News.
November 19, 2025
Nov. 19, 2025, 10:44 AM EST / Updated Nov. 19, 2025, 4:46 PM ESTBy Rob WileComputer-chip giant Nvidia reported earnings and revenue Wednesday that beat Wall Street estimates, a signal to investors that the artificial intelligence boom that has fueled 2025’s record U.S. stock market gains and backstopped the economy writ-large likely has more room to run. Sales of its trademark Blackwell AI chips “are off the charts,” while another set of key computer processing units “are sold out,” Jensen Huang, founder and CEO of NVIDIA, said in a statement.Shares of the world’s most valuable company were up approximately 3% in after-hours trading. Nvidia’s chips have been the catalysts for a massive build-out of data centers that have supplied a backbone to the U.S. economy amid slowdowns elsewhere. More money is flowing into building data centers than all other manufacturing facility types combined, according to the research group S&P Global.Until recently, that spending has also powered major stock indexes to record highs. Lately, however, stocks have shown signs of wobbling lately. The declines in share prices — led by tech companies — have sparked debates about whether AI-driven gains are beginning to slow. This raises a bigger question: how the broader economy will perform if it no longer benefits from all the wealth the AI boom is creating. Wall Street woes: Is the AI bubble starting to burst?02:17The U.S. economy has become “highly dependent upon three basic elements: continued consumption amongst the affluent, AI investments, and asset appreciation,” Bill Mann, chief investment strategist at Motley Fool Asset Management, said in a statement Wednesday.“The market downdraft, led by the recent high-flying tech companies, is a recognition that the expectations for AI returns may be overly optimistic,” he said.Huang said last month that his company had $500 billion in orders for its chips, for 2025 and 2026 combined.“This is how much business is on the books. Half a trillion dollars’ worth so far,” Huang said at a conference in Washington, D.C.Alongside broader concerns about the state of the U.S. economy, stock market momentum has been tripped up by worries about circular dealing among AI’s biggest players. This means the same money is being passed back and forth between several companies — even as each company’s individual value climbs.Nvidia is a fixture in the kinds of deals that are raising concerns. It recently announced a commitment alongside Microsoft to fund AI software provider Anthropic with $10 billion. Nvidia CEO Jensen Huang during the Live Keynote Pregame of the Nvidia GPU Technology Conference in Washington, D.C., on Oct. 28.Jim Watson / AFP – Getty Images fileThis kind of big collaboration news would typically boost the stock prices of all the companies involved. But neither Nvidia’s nor Microsoft’s stock got a boost from the Anthropic announcement.Analysts with Deutsche Bank said this is a sign of the ongoing investor wariness about deals like this.“It goes to show how sentiment has turned more negative in the last few weeks, with the circular AI deals being treated with increasing caution as the conversation around a potential bubble has gathered pace,” they wrote in a note published Wednesday. The question now is whether the latest market hiccups represent a temporary pullback or the onset of a more permanent state of affairs. Most experts are cautiously optimistic that the market will continue to climb. “We think the investment boom has room to run,” Goldman Sachs researchers wrote in a note published Wednesday, adding that the economy writ large has remained resilient, something that should provide ongoing support to stock returns. Stock “valuations are certainly stretched, yet they remain below the extremes of the dot-com era,” Seema Shah, chief strategist at Principal Asset Management, wrote in a note published last week. What’s more, many firms’ high stock prices are justified by still-solid earnings growth and robust revenue prospects, she wrote. Still, “some investor skepticism about the likely return on that investment is healthy, particularly when it is impossible to quantify the scale of productivity improvement to expect,” she wrote. Rob WileRob Wile is a Pulitzer Prize-winning journalist covering breaking business stories for NBCNews.com.
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