Contact us
CALL US NOW 1-888-GOLD-160
(1-888-465-3160)

Gold Can Unify Us Across the Great Political Divide

  by    0   0

There is one thing Republicans and Democrats should agree about – buy gold.

But like everything else, the yellow metal has become politicized. If you believe the stereotype, only people on the right buy gold. A recent article by Martin Tiller at Nasdaq.com highlighted the phenomenon.

During the Obama Presidency, gold somehow became politicized. Glenn Beck, for one, seemed to suggest to viewers that Obama’s election foreshadowed the end of the world as we know it, then popped up in the commercial breaks urging viewers to buy gold. As these things tend to go, the fact that gold was therefore appealing to many on the right made it despised by those on the left.”

This is understandable in these hyper-politicized, overly polarized times, but it really doesn’t make sense. The reasons to own gold are economic, not political. Sure, politics has an impact on the economy. But recessions, geopolitical shocks, stock market crashes, national debt – these things all happen no matter which party is in control.

The latest political brouhaha revolves around the Republican tax plan. It’s looking increasingly likely the GOP may actually get something done. That has the stock market all juiced up. As we’ve pointed out, the optimism may be unwarranted. Peter Schiff called the plan “government on a credit card.” And it’s true. While the plan will certainly reduce the tax burden – at least on some people temporarily – it does nothing to actually shrink the size and scope of government. As long as the federal behemoth is growing and spending money, we’re going to have to pay for it – if not today, tomorrow.

Nevertheless, those Republicans who have traditionally bought gold are sinking their money into stocks because they are optimistic about the Trump economy. Peter has said this is a mistake.

The people who typically buy gold in America voted for Trump, and they’re no longer worried about the economy. So they’re not buying gold. They’re buying stocks instead, and I think they’re making a big mistake. They should be selling their stocks and buying even more gold.”

But again – it really doesn’t matter whether you’re a Republican or a Democrat. The economic impact of a policy doesn’t care about the politics of those who implement it.

Of course, your politics will probably influence how you perceive the impact of a given policy. But according to Tiller, passage of the tax plan is a good reason to buy gold no matter how you view the politics.

There are two schools of thought about the tax cuts in that bill; they can be regarded as either pro-growth or deficit busting, depending largely on one’s political affiliations. If either of those proves to be true, however, a case can be made that an investment in gold will pay off.”

The Republicans claim their tax cuts will spur investment, grow the economy and create lots of jobs. Conventional wisdom holds that this would be bad for gold. But consider this. Unemployment is already at a low level. That has some interesting ramifications, as Tiller explains.

With an unemployment rate around 4% and signs of some upward pressure on wages in the second half of this year, it will certainly add to fears of inflation taking hold. Gold is used by traders as a hedge against inflation, so if Republicans are right and we get a big boost to growth, gold buyers win.”

On the other side of the political aisle, Democrats are embracing the doom and gloom Republicans wallowed in for the eight Obama years. They believe the rich will simply hoard their tax cut money in off-shore accounts and the promised economic growth will never materialize. That will add to an already out of control national debt. (Yes, it is weird hearing people on the left fret over deficits – but it is what it is.) That scenario is also good for gold.

The yellow metal is, in addition to a hedge against inflation, a safe-haven play used by traders when they fear disruption, and there is nothing I can think of that would be more disruptive to the global economy that even a hint of a bankrupt America. So, if Democrats are right, gold buyers win.”

So, you see, gold really can unify us across the great political divide.

The two sides may have completely different expectations from the tax cuts and therefore different reasons for doing so, but whoever turns out to be right the effects on the economy will probably be such that both will end up in profit. Making money, it seems, is one of the few things left that has no partisan slant.”

WhyBuyGoldNowBanner.070815.590

Get Peter Schiff’s latest gold market analysis – click here for a free subscription to his exclusive monthly Gold Videocast.
Interested in learning how to buy gold and buy silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!


Related Posts

Jim Rickards: Junk Bonds Could Set off the Next Crisis

Last month, we reported on troubling signs in the corporate bond market. According to Moody’s, the majority of US companies have a “speculative” credit rating. They are considered high risk. As a result, their debt is “high yield” or “junk. When you combine leveraged loans and junk bonds, the total level of “junk” debt in the […]

READ MORE →

Three Reasons Gold Will Rise from Its Slumber

The price of gold has languished in recent weeks. After falling below $1,300 in May, the yellow metal has hit 2018 lows this month. Dollar strength along with the anticipation of further Federal Reserve rate hikes have bolstered the dollar and weighed on gold. Peter Schiff has been saying this dollar strength is merely an upward […]

READ MORE →

Which Countries Produce the Most Gold?

Global mine production fell slightly in 2017, the first drop in mine output since 2008. In fact, gold production has generally increased every year since the 1970s. The drop in 2008 was something of an anomaly, as it occurred at the onset of the 2008 financial crisis. The recent slowdown in mine production is more […]

READ MORE →

IRS Building Walls to Keep Americans In

There has been a tremendous amount of debate about building walls to stop illegal immigration. But the IRS is building walls to keep Americans in. The US government is cracking down on Americans with outstanding tax bills by revoking passports. 

READ MORE →

Gold in Tech: Gold Nanoparticles Could Boost Solar Energy Storage

Rutgers University-New Brunswick researchers have developed a star-shaped gold nanoparticle that could open the door to improving storage of solar energy. According to scientists at the university, the nanoparticle coated with a semiconductor can produce hydrogen from water over four times more efficiently than other methods. The development could boost solar energy use and possibly […]

READ MORE →

Comments are closed.

Call Now