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Trump: A 2020 Democrat Triumph Could Crash the Stock Market

Posted by Metals Corporate on

Trump: A 2020 Democrat Triumph Could Crash the Stock Market

By John McDonald

In the days leading up to his official campaign launch, President Trump was not particularly modest in his evaluation of how his time had been spent in office so far. “The Trump Economy is setting records,” he tweeted one morning. The next, he noted he believes under different leadership, Federal Reserve policy could have created a stock market “10,000 points higher.”

It came as no real surprise, then, when the president launched his 2020 campaign for president that he would home in on the economy as one of his core issues. In fact, he went so far as to say without him, the market crash would be “the likes of which has not been seen before!”

President Trump has consistently played up his business experience in relation to keeping the national economy healthy. Since voters consistently cite the economy as an important issue during election years, his ability to keep voters focused on his economic policies and track record could be key to winning reelection. “If anyone but me takes over in 2020 (I know the competition very well) there will be a Market Crash,” he wrote recently, driving the point home.

The truth about whether republicans or democrats create economic prosperity is much murkier than the president makes it appear. For starters, both parties have, in recent history, abused the budget deficit. Running up the deficit creates a deceptive appearance on a national level because it enables the government to “dampen” the effects of an economic downturn for the price of going into additional debt. In the short term and even medium term, this can create the impression that a president has enacted revitalizing economic policies. However, in the long term, the debt grows and the fundamental issues remain because the downturn did not force their correction.

While Trump is not necessarily “trumpeting” the benefits of a Trump 2020 win in terms of the price of gold, the last time a republican incumbent won reelection, gold and silver markets both performed strongly and began major bull runs in the wake of the election. When the president won in 2016, the stock market reacted so positively that precious metals experienced something of a “damper” on retail

demand, but that stagnation seems largely past at this point. Many analysts predict that as the democrat frontrunners emerge, gold prices could rise in response, especially if those frontrunners have socialist tendencies that might lead investors to “hunker down” and attempt to weather the economic storm that would ensue after such a win.

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