The Fear of Joe Biden, Silver, Gold prices and the Falling U.S Dollar – August 5, 2020
So Gold hit $2000USD today and nobody is really excited, because, well, we’re now stuck in limbo wondering if the US Government money is going to be fully socialist. Fiat money is what I call political money, it tends to get more politicized when there’s Left-leaning political leadership of a country that appears to have a low economic IQ.
The internet has created a lot of investors who under Austrian economics and the consensus of the markets appears to conclude that they’re not sure what to make of Joe Biden. Now, although the likely VP of the Biden administration will be Susan Rice, Susan doesn’t exactly strike anyone as a Socialist or a woman who cares for reparations or appeasing the AOC led democratic socialist democrats.
Susan Rice appears on the surface to care more about starting or maintaining an American presence in other countries, she’s definitely a component of the deep state, which makes her wild card. Economically, I don’t even know if Susan rice has a fixed position, so all of this leads the markets to believe that a Joe Biden presidency will be a wild ECONOMIC ride.
Now, obviously under Joe Biden, the poor will get poorer, but what’s worse is that Joe Biden will probably get what Donald Trump has always wanted which is a devalued U.S dollar. Because Trump as a private citizen operated n the private sector, the prices Trump would pay for his materials would be much different from what the every day Americans would pay.
When you buy bulk, and when you offer value to a seller, you experience with cheap money will be different from a middle-class person who is at the mercy of retailer and retail prices, I say this because a lot of people are often confused as to why Trump wants a devalued U.S dollar.
Yes retailers will drive down prices, but America is still reliant on imports and America’s pubic sector is very big. Joe Biden represents the U.S government getting even bigger and unlike Donald Trump, Biden will add regulations to the U.S economy and unlike Trump, OPEC will be back to fixing prices the way they see fit under a Biden administration and this complicates everything.
Nobody talks about oil anymore and they don’t talk about oil because Trump has done what no other president has done before him, which is to watch the price of oil like a hawk. Trump is a businessman and business people make calls. I can guarantee you that Trump is in close communication with the important members of OPEC to keep prices down. Joe Biden will do no such thing and Joe Biden from a market perspective is like the dumb clueless uncle taking care of the kids for the weekend.
Trump makes it look easy, but if you’re active in the markets, you know how hard Trump is working behind the scenes. All of this goes away with Joe Biden as president and I personally don’t see gold and silver prices going up, I see the U.S dollar going down.
When the U.S dollar goes down, it typically means that there’s an energy rally waiting to happen. As far as the markets are concerned COVID-19 is yesterday’s news, what’s not yesterday’s news are shortages, a shortage of things requires an uptick in energy and commodities.
Now before the markets place their bets, the markets need to know who the president of the United States is going to be. Obama could have had the easiest recovery when the housing market crashed, but Barack Obama did everything opposite to what the markets wanted.
Barack Obama rewarded Wall Street and punished Mainstreet, speculators were rewarded and savers were punished, speculators expect the exact same thing from Joe Biden, but you know which savers will be rewarded with Joe Biden as President? Savers of Gold and Silver, because as many people have already pointed out, solar panels need silver, ‘industry’ needs gold and Joe Biden guarantees the price of energy will be going up with the Green new deal!
Higher energy prices equal lower U.S dollar, but wait it gets better, most countries of the world have bigger governments than the United States and the last thing these countries want is a higher valued currency. most countries prefer regressive taxation, which means they’re anti-consumption, sounds fiscally responsible right? WRONG, taxes are taxes and regressive taxation is actually in existing to pay for bloated government, and these regressively taxed governments usually have tariffs that make trumps tariffs look like a slap on the wrist.
Lower consumer prices, Lower tariffs less revenue for governments outside the United States. During the Obama administration, it appeared to me that Canada had to artificially destroy its own economy to devalue the Canadian dollar which at one point reached parity with the U.S dollar.
When idiots like Bernie Sanders says that he wants to make the U.S more like Sweden, the markets listen. A consumption-led economy is a liquid economy, the Democrats make the U.S economy illiquid, which is obviously bad for the U.S dollar. Now if people and entities are going to hoard anything during the Biden administration it probably won’t be U.S dollars, not until the markets know what his administration is up to.
As I’ve been saying for months I don’t see a pullback in Gold unless it’s clear that Donald Trump will win the 2020 election. Joe Biden is terrifying to the markets and the Democrats would be wise to keep Joe in the bunker.
Interesting times ahead!