gold prepares for the election

 

I've never believed the stock market discounts the future.  Because it relies on the psychology of the masses.  And the masses are usually wrong.

Gold, however is excellent at looking into the future, because its movement is ultimately decided by the the global central banks that conrol the economic and political future.

And Gold, right now, has its eye firmly on the US coming election.

Because Gold thrives on chaos, strife, and most of all Gold thrives on War.

There are already two hot wars, one involving Europe and Russia, one involving Israel and Hamss/Iran/Hesbollah.  And both wars have an enormous impact on the all importan US-China relationship.  

And the coming election will be key in what happens to those two hot wars.  

Gold sees an outcome in the coming election that will cause the wars to boil over and spread.

And as the war spreads international trade dies and commodity prices are driven up and up and up.  At the same time war kills demand for discretionary purchases.

Gold also thrives on trade war.  Trade war is highly inflationary globally.  Tarrifs are a tax on the consumers of the country that imposes the tarrifs.  At the same time it drives up prices in the exporting countries that seek to recoup lost profits.  Global GDP dives as global costs rise.  Trade war is wonderful for Gold - if nothing else.

Gold sees an outcome in the coming election that will mean massive Trade War.

Gold thrives on civil war.  It doesn't have to be declared war.  Just violent tension between various citizen groups tends to eventually kill the animal spirits that drives discretionary spending.  Eventually people start hoarding essentials that they belive to be scarce or that they believe will become scarce.  This is highly inflationary.

Gold sees an outcome in the coming election that bodes well for civil war.

Gold thrives on poltical warfare.  The less civil an election cycle the more gold likes it.  The more the various branches of government appear to be at war amongst themselves the better it is for gold.  The stronger the Centralized government becomes the better for gold.  This is because an economy thrives on Trust.  The belief in its institurions in crucial for that trust.  As trust erodes people stop spending and start hoarding.  In the early stages of trust erosion you may well get YOLO - you only live once - spending.  But as the erosion of trust continues you get Survivalism.

Gold sees an outcome in the coming election that will lead to a survivalist mentality.

Gold particularly loves Autocracy.  The more likely the election is to result in Autocracy the better for gold.  Look at Turkey - or Hungary - for democracies that have moved towards Autocracy.  The inflation rate in Hungary is 30 percent.  The inflation rate in Turkey is 65 percent.  

Gold sees an election outcome that will lead towards Autocracy.

It's not as if Gold is omniscient.  But Gold is the reflects the collective vision of the global central banks.  Ands this is what gold sees.