When the Election Dust Settles

05 Nov

When the Election Dust Settles

Gold After the Election

Let’s sample some informed opinions about what will happen once the election is (more or less) settled:

According to the Royal Bank of Canada, once the dust settles, gold will resume its march higher.  

According to The Union Journal, George Gero, the managing director of RBC Wealth Management, believes traders will begin looking to “stimulus legislation, inflationary prices [and] large debts,  so gold can resume the upward trend towards $2,000.”

The Swiss-based investment banking powerhouse Credit Suisse, says, “Big picture, we continue to look for $2300.”

The bank’s strategists observe that “gold extends its consolidation from our $2075 target hit in August and we maintain our core view this is a temporary and corrective pause in the broader uptrend. Indeed, price action is beginning to increasingly look like a bullish ‘wedge’ continuation pattern, adding weight to our view.” 

In a CNBC interview, James Rasteh, CIO of Coast Capital, said that US fiscal and monetary policies will remain much the same no matter who claims final victory.  

This is a view we have expressed many times ourselves, most recently two weeks ago when we took a look Behind the Curtain where the Great and Powerful Monetary Oz twists the dials that set our economic course, push buttons that boom and bust the economy, and work the levers to determine the value of our money.

“We would be printing trillions of dollars more and all of that ultimately has extraordinarily positive repercussions for gold,” said Rasteh, pointing to a sizeable stimulus program without regard to the election outcome.”

Despite the ongoing counting, gold is bullish no matter which candidate wins

Let’s look at a historical perspective from the World Gold Council.  Juan Carlos Artigas, the Executive Director and Head of Research points out that gold goes up no matter which party controls the White House [emphasis added].  

“Looking back, gold’s performance has not significantly differed based on the party controlling the White House. Since 1971, gold returns were 11 percent on average per year during Democratic presidencies and 10 percent during Republican ones. Similarly, gold returns were only slightly higher in the year following a challenger party’s victory relative to an incumbent party’s victory (7.9 percent versus 6.5 percent respectively).”

We recommend that you keep your wealth in real money that cannot be corrupted by politicians and central banks.  And we recommend that you make the move now, while you can.