With the election season in full swing, I expect the national divide to widen. There are at least 2 realities and which news you watch will feed one of them over the other. I am amazed at some of the things said to me but have learned to just observe with my own eyes and ears and not depend on pundits or others to wash my brain. No one can be completely immune to the news and pundits bashing the other side, but you can have a few items that you watch to help discern your truth. Crime rates, inflation, jobless claims and more tell you a great deal about is is actually being done rather than just being said. Look don't listen!
The election results will likely take weeks to finalize with all the voting by mail changes being implemented. Personally, I believe the healthy should vote in person and that absentee ballots be requested for others. But ballots in many states will be sent out whether requested or not and that opens the door to fraud. Sorting things out, then the legal challenges and we'll be lucky to have a duly elected president by the New Year. I find this unnecessary and quite frustrating. Perhaps you do as well. We all expect the winning candidate to make changes that meet with our personal desires and beliefs and the expectations of a better country abound on both sides. But some things remain the same.
The US National debt is outrageous. It is only possible because the Federal Reserve now buys it in form of bonds and with printed money thus inflating the currency supply, the stock market and other assets while devaluing the US Dollar. This ebbs and flows but the end result no matter who wins the election is more debt, a lower dollar and ultimately price inflation. The traditional form of inflation in higher consumer prices though it is not the only inflation. There is also inflation in form of necessary taxation whether local, statewide or national. All that money being printed is a hidden form of tax because in time the dollar will buy less...maybe a lot less. You may not file a return for this type of taxation but it's still a tax leaving less purchasing power in your pocketbook.
The Federal Reserve claims interest rates will remain at or near zero until 2023 or so. Well, the market will determine real interest rates and the Fed will have no choice but to raise. Just a 1% increase would challenge debt payment and 2 or 3% start eroding other programs like defense, social security and medicare. You want too see unrest? Just stop SS or Medicare look out! When a country prints money wildly like the US is doing, eventually it can become less valued and even valueless. Just look at Zimbabwe or Venezuela.for modern examples. When confidence goes, there also goes the currency value. No one wants it. The US Dollar is one of the world's reserve currencies but that could change again lowering its value further.
I recommend staying alert to this as an important subject. Surely, covid19, street unrest and political fights are a big part of life right now, but these will tend to run their course. The National debt is here is to stay no matter which political party is in the white house or controls the congress and effects all especially middle class and the poor. Some things never change and the politician's addiction to other people's money never changes. It is worse now than ever and will not end well.
The rich can just move physically or move their wealth into other areas avoiding the US Dollar collapse, street unrest and any unpleasant circumstances.
You can diversify to other investments and hedges outside of the US Dollar like emerging markets, gold, silver some foreign currencies. There are banks that permit you to denominate your accounts in a choice of currency(ies). The Yen, Swiss Franc and even the Euro can help maintain value as the US dollar drops and though volatile, gold and more so silver are the classic classic hedges against loss of currency value.
The news will focus attention and likely in one or the other political party's viewpoint and favor. Watch at your own risk. I suggest you look and don't listen. Give due attention to the US Debt, printing press and value of the dollar. A little planning now will be rewarded and your attention will be more focused on the real problems that will persist no matter the election outcome. Trump likes spending but the Democrats love it too. I'm afraid the difference is just in what they spend on. Do a search on "hidden tax of inflation". You may discover an entirely new way of looking at things.
Best,
Donn Marier
DM-Your Own CFO