So many of us are rightly worried about how long the Transportation Security Administration can keep pushing people through screening lines for free that, or how much food the federal government can inspect for safety for free, that we're just ignoring the huge work slowdown at the Securities and Exchange Commission.

Bear with me, friends. If you have more important priorities than the SEC, I feel your pain.  However, if the SEC can't process regulatory filings, then companies can't go public.  If companies can't go public, that means they can't raise rounds of capital by selling stock. Many of these companies are owned by a combination of insiders, venture capitalists or private equity investors.  Going public is not only how those investors realize their returns, but how these companies pass from Series A-D rounds of funding in order to raise capital for their public phase of growth.

Without asking anybody to cry for the fat cats and lucky entrepreneurs who are putting off their multimillion dollar paydays, I think we have to recognize that completely shutting down an avenue that companies use for capital raising is... bad for the economy.

At the same time that companies cannot go public, investors cannot register new hedge funds, mutual funds, exchange traded funds, or business development companies.  So, we get no new issues and, at the same time, no new pools of capital to invest in new issues.  This, at the very least, slows the velocity of the economy.

As with the missed wages of federal employees, the shutdown advocate's response can only be, "but the government won't be shut down forever and so these companies can all IPO later in the year."  But it's not a great answer for a few reasons:

1. Some companies might need funding sooner rather than later. This is often the case with biotechnology companies (and don't get me started about slowdowns at the FDA).
2. All of these companies can't IPO at once as there is finite demand for new issues. Shutting down the government compresses the IPO calendar.  Underwriting banks are going to have to make some decisions and some companies might never get their chance if the calendar is too compressed.
3. Making the VCs and Private Equity firms wait longer hurts their returns since their ability to deliver for their investors relies on them earning the highest return in the shortest amount of time. That can hurt the whole funding model for emerging businesses and can also hurt the public and private pension funds invested in these vehicles.

To end on a scarier note -- you also need the SEC to review and approve filings for issuing corporate bonds.  While many companies can get by with ultra short term commercial paper, companies that issue high yield bonds generally don't allow those bonds to mature -- they refinance them in order to maintain and extend liquidity.  Without an SEC around to facilitate that process, we could see companies crashing into a wall of liquidity that would make 2008 look like... well... 2008 without a functioning government.