In just over a week, voters will get to make their choice for the next US President in one of the nastiest contests of the post-1945 era. It was Ronald Reagan who said the nine most frightening words in the English language were “I’m from the government and I’m here to help.” He was right – government ‘help’ usually means handing someone else’s cash across the table, and often cash which the government doesn’t actually have.
Those reluctant Trump supporters who, after he was narrowly voted into the White House in 2016 thought he might grow up, stop using Twitter as a tool of government, and tone down his wilder rhetoric, have been disappointed. Those who thought he meant it when he said he would “drain the swamp” have been grievously cheated. Instead, the swamp seems to have lapped at the White House – no matter which way you view it, paying almost zero taxes smells rather badly.
Trump’s adamant refusal to say that he will step aside if he loses this election is already getting level-headed commentators speculating about a looming constitutional crisis. Secession of some states to form a new country and/or a civil war have been mooted, as has that the USA drifts into becoming a version of the thoroughly corrupt Ottoman Empire, which like a wedding cake rotting from the inside crumbled to dust after the 1914-18 world war.
None of these options will be pretty. But a peaceful transition of one presidency to another seems increasingly unlikely.
A survey by the Pew Research Center at the start of October found that 50% of voters say they are confident in Biden to “bring the country closer together”, compared with just 30% who favoured Trump.
An article in The Hill in September this year put the divide very clearly: “Nothing the president does pleases his political enemies. Nothing he does displeases his most loyal supporters. One side will never embrace him. The other will never abandon him. If Trump says 2 plus 2 equals 4, the left would say he’s lying. If he says 2 plus 2 equals 3, his supporters would nod their heads in agreement”.
As of today, a US betting site – a more reliable a gauge for me than opinion polls – puts Trump’s chances of winning at just over 32%, against Biden’s slightly more than 69%. A Biden victory – even if uncontested – will not however bring peace, harmony and universal cheer. Nor will it bring greater fiscal confidence, as Biden’s platform tries to buy voters with lavish and unfunded promises of motherhood and apple pie.
What does Biden stand for? The Democratic Party ‘platform’ agreed in July is a rag-bag collection of all the current precepts of the “woke” agenda and equally as divisive as anything stemming from the Trump camp: “We know that four more years of the crass, craven, corrupt leadership we have seen from Donald Trump and the Republican Party will damage our character and our country beyond repair… Democrats call on all Americans to come together and seize this last, best chance to restore the soul of our nation – and vote this November to ensure our greatest days are still to come”. Talking about making the US great again seems straight out of the Trump 2016 playbook.
The platform accuses Trump of being responsible for the deaths “of tens of thousands of Americans” over his supposed failure to handle the Covid-19 pandemic properly. It promises to raise the federal minimum wage to $15/hour by 2026, build 500,000 public charging stations for electric vehicles, build a “second great railroad revolution”, raise tax rates, “end” poverty, increase social security payments, “end” violence against women, and make public colleges and universities tuition-free for families earning less than $125,000 a year, about 80% of the nation. None of these – or the many more – promises are costed-out. Higher taxes are inevitable, to pay for the free healthcare, free tuition and free childcare promises.
Gold is the winner
The dislikeable or the tax-hiker – it’s not a great choice. But whoever wins it will mean that gold prices will likely move higher.
If Trump wins, by hook or by crook, we can expect a resurgence of social unrest, as the various disparate groups who loathe everything he stands for take to the streets and protest they have been cheated. We can expect Trump to be at his most authoritarian self, taking aggressive steps to put down what he will describe as a left-wing attempt to overthrow democracy. Political turmoil will translate to a weaker dollar.
If Biden wins and moves into the White House he will be saddled with a vast array of promises which the US will only be able to afford by increased borrowing. But the US is rapidly approaching the point where lenders might start to question its astronomical debt.
With the US national debt now higher than $27 trillion, and the interest payable on that almost $1 billion per day, by 2050 the national debt could rise to 180% of gross domestic product. The ratio of workers paying taxes to support each Social Security beneficiary will by 2034 decline from 3:1 to 2:1. The tax revenue base is shrinking, the spending demands are growing, and will only grow faster no matter who wins this election.
US citizens could simply see another four years of political gridlock, with the losing side conducting a prolonged and continuous sniping campaign against the winner. The US is bitterly divided and neither candidate looks like being able to re-unite the country.
Clearly, here at Glint, we would never offer advice on what you should do with your money, even in unprecedented times like these, but let me ask you a question; if there is a likelihood that political and fiscal catastrophe are around the corner, wouldn’t you want to prepare for that kind of uncertainty by trusting your hard earned savings to gold, which is and will become an even more secure a form of money in the short and longer-term?
Maybe you’d like to remind your friends about what you already know about Glint – you can buy real gold, save real gold, but also spend real gold – on anything, even at the check-out. It’s your gold, increasing in value over time, safely secured in a vault in Switzerland, that you can access digitally in real time through your Glint app and Mastercard®, so you can spend currency that’s increasing in value… even in this climate! Worth thinking about…?