Contact us
CALL US NOW 1-888-GOLD-160

What Would a Biden Win Mean for the Economy?

  by    0   0

Peter Schiff appeared on Kitco News with David Lin to talk about the investment implications of the upcoming US elections.

Peter said he doesn’t feel good about the election and that he thinks Biden will likely win. He said the Democrats may even gain control of the Senate. So, what would a Biden win mean for the economy?

As reckless as the Republicans have been with borrowing and spending, I expect the Democrats to be even worse. And unfortunately, unlike when Obama was president and you had some pushback from the Tea Party in the Republicans to kind of rein in Obama and keep him from borrowing and spending as much as he would have liked, that opposition is not going to exist anymore. Basically, the Tea Party is dead. Trump helped kill it.”

Peter said with the ramped-up spending will come even more money printing and that will lead to inflation running out of control.

Peter noted that Trump ran on shrinking the trade deficit. Last month, the US charted the largest monthly trade deficit in goods in the history of the country.

Our trade deficits with China have never been bigger. Our trade deficits with Mexico have never been bigger. So, if we were losing on trade before Trump was elected, we’re losing even bigger since he’s been elected. So, the budget deficits are out of control. The trade deficits are out of control. Government is bigger than ever, spending more than ever, borrowing more than ever. The Federal Reserve is printing more than ever. We are further away from greatness than we have ever been.”

As result, Peter doesn’t think a lot of people will be willing to take another chance on Trump.

I think more people now are going to vote Biden if they want change, even though, clearly, Biden doesn’t represent change. He represents a continuation of the failed policies. But Trump isn’t change either because he’s the incumbent. So, I think when times are bad and voters are frustrated, the tendency is to throw the bums out, even if it means putting another bum in.”

Peter said a Biden win would almost certainly mean a big increase in taxes, especially if the Democrats control both houses of Congress.

You’re talking about a dramatic, maybe even an unprecedented increase in the taxation of corporate earnings, which is going to have a dramatic impact on the value of companies.”

Stimulus could somewhat mitigate the impact of higher taxes on stock values. Peter said a Biden win would likely mean an even weaker economy. That would likely lead to even more borrowing, spending and money printing to keep things propped up.

Bad news is good news. Why is bad news on the economy good? Because it means we get more stimulus. We get more money printing. That is the only thing that’s driving the stock market. So, they’re looking at the bad news of a Biden win as being good for the stock market, not because it’s good for corporate earnings, it’s not. Corporate earnings are going to get crushed under Biden. What the markets care more about is the stimulus. The stimulus trumps the earnings. I don’t even think earnings matter in this market anymore.”

Despite the market reaction, Peter said he doesn’t see anything bullish about a Biden victory.

I don’t think the money printing and the deficit spending is going to be enough to compensate for the lower earnings in a weaker economy. And I think the market is already so overvalued from past stimulus  that I don’t think the future stimulus, even if it’s bigger, is going to have anywhere near that impact.”

More stimulus means more dollars printed – the very definition of inflation. It also incentivizes people not to work. We end up with a phony recovery instead of a real recovery. That’s bad for the dollar.

I think once the dollar starts to fall, it’s going to turn into a freefall. That is the crisis that’s coming. It’s not going to be a financial crisis. It’s going to be something so much worse than that. It’s going to be a US dollar crisis, which means it’s also going to be a sovereign debt crisis.”

Peter said he doesn’t see any other currency replacing the dollar.

I see gold replacing the dollar. I mean, the dollar replaced gold. So now, gold is going to replace the dollar.”

As Peter noted, central banks already hold gold.

It’s there. So, all they have to do is increase their ownership of gold to replace the lost value of the dollar. And a lot of the transition is going to take place in the market. When the price of gold moves up – right now it’s at around 1,900 – when it goes up to 10,000, 15,000, 20,000, that means that by default, the reserves that central banks have, now their percentage of gold reserves is going to increase.”

In the short term, Peter said gold has done well under Trump and it can shine even brighter under Biden.

The economy is going to be far weaker under Biden. Everybody can see that. The deficits are going to be much bigger. The Fed’s going to be printing a lot more money. That is very bullish for gold.”

Download SchiffGold's Gold vs GLD EFT's Guide Today

Get Peter Schiff’s key gold headlines in your inbox every week – click here – for a free subscription to his exclusive weekly email updates.
Interested in learning how to buy gold and buy silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!
Photo by Gage Skidmore

Related Posts

Peter Schiff vs. A Marxist Professor: Is Socialism the Problem or the Solution?

Peter Schiff debated Marxist professor Richard Wolff on RT Boom Bust. Wolff just can’t grasp that socialism isn’t the solution to America’s problems. Socialism is America’s problem.


Peter Schiff: Double-Barrel Inflation Is Locked and Loaded

The Consumer Price Index blew past expectations in October as the “transitory” inflation narrative continues to unwind. CPI was up 0.9%. On an annual basis, the inflation rate was 6.2% compared with a 5.9% estimate. It was the highest annual CPI gain since 1990. The CPI stole the headlines, but the Producer Price Index also […]


Peter Schiff With Megyn Kelly: Inflation Robs Working and Middle-Class Americans

Despite government officials and central bankers continuing to peddle the “transitory” inflation narrative, the average American isn’t buying it. They feel the squeeze of rising prices in their wallets. And it’s the average American who is hurt particularly hard by the skyrocketing cost of living. Peter Schiff appeared on the Megyn Kelly show to talk […]


Peter Schiff: Stock Up Now! Inflation Could Get Very Ugly

The price of pretty much everything is rising precipitously. The CPI for September came in above expectations with a month-on-month increase of 0.4%. Peter Schiff appeared on Unfiltered with Dan Bongino to talk about inflation in Joe Biden’s America. Peter said you should stock up now because things could get ugly really quickly. Bongino pointed […]


Peter Schiff: This Is a Record We Don’t Want to Break

A surge of imported services drove the trade deficit to a new record in August. Peter Schiff appeared on NTD News to talk about the trade imbalance. He said it is not a sign of a strong economy and not the kind of records we want to be breaking.


Comments are closed.

Call Now