Economy on the Line as America Prepares to Vote

US Election 2020

Next week’s election may or may not be the country’s most important ever overall, but it certainly is the biggest ever for the economy. We’ll look at the issues from the economy’s perspective.

What makes the 2020 U.S. presidential election stand out so much is how different incumbent Donald Trump and challenger Joe Biden differ on the economy. The economy may be seen by many as one of several key issues in this election, but it is the biggest and also factors into many of the other issues that will have an economic impact one way or another, and this is well worth a final look as we await the results.

A good example of this is with what is being termed the coronavirus issue, and the way that this one has impacted things and has the potential to continue to impact the economy for some time is pretty profound in itself.

Joe Biden has hitched his horse to the very destructive idea that pursues various strategies that have severely harmed the economy and his plan seeks to continue to be willing to ignore economic consequences of policies that have not ever been shown at all to reduce coronavirus deaths. To the contrary, have been shown to increase both the primary deaths from the virus and cause an alarming number of collateral deaths, and these extra deaths have been shown to involve human years even greater than that produced from the total official COVID deaths.

The scientific consensus, among those whose expertise is public health policy and not just narrow fields such as virology, is that by trying to flatten the curve, this will prolong the natural progression of the disease and cause more at risk patients to contract the virus and die. This is actually common sense as well. This was originally thought to be a way to not limit the overall casualties but to spread them out over a longer period to allow health care facilities to not be overwhelmed, but they never were and we’re still clinging to this broken and harmful idea anyway to a large degree.

While even the official health authorities are now backing off on the idea that lockdowns are a good thing, the partial version of this, which we call social distancing, continues to impact the economy. Even Sweden, which did not lock down but encouraged social distancing, has seen their economy take a significant hit, even though a lesser one to be sure than countries that did lock down and are still doing it now.

As lockdowns clearly ravage economies, which is so beyond dispute that even the fake media admits to it, social distancing does the same thing, and not on a small scale either. Not only does this limit business capacity, it also requires businesses to bear additional costs to adapt to new rules, and the net result is that this inflicts significant economic damage, especially in businesses where social distancing is a particularly limiting factor. Somehow, none of this is seen to even be worth considering, unless you are trying to blame it on Trump, who has been one of the very few political voices against this in the country from day 1.

Some may think that scientists are just now coming to an understanding that delaying the spread of COVID is a terrible idea, but this view has been around right from the start, with the difference being that is that it is making its way around the media more now, rather than being kept out of the public eye.

As we told you all the way back in January, there has always been just one way out of this, for the virus to play out in the population to the point where herd immunity is sufficiently achieved to get it under control. There is no other way possible. This particular virus is dangerous to elderly people but comparable to everyday infectious diseases like the common cold and the flu with the rest of the population, which is why leading experts in epidemiology have been pushing the idea so hard of protecting the vulnerable and letting the virus run its natural course with the rest of us.

Sweden’s handling of this has come the closest, and even though their social distancing has kept them from achieving full herd immunity as of yet, they came much closer and this is the reason why the pandemic ended for all intents and purposes in July, where the death rate fell from over 100 a day to one or two deaths a day, with a maximum of 7 in a single day since.

Among the candidates, Trump’s desired approach is far more in line with the view of the experts, and Dr. Fauci or Dr. Redfield are not experts in this field, and not even close. Although they do have their particular fields that they are at least considered experts in, public policy or even epidemiology are no more their fields then rocket science is.

This does not stop them from professing to be, and even more so than actual experts such as the world-class epidemiologists that are speaking out against them, or Dr. Atlas, where they are supposed to be more of an expert on public health policy than Dr. Atlas is, who is an actual expert on the subject, with their not even needing prior knowledge or training on the subject to allegedly surpass him.

The arrogance of these officials seem to know no bounds, even claiming to be experts on masks, showing their gross ignorance of the science, where masks being useless in preventing viral spread is beyond actual controversy, although you can always stir up fraudulent ones which they shamelessly have promoted.

Someone must have told Joe Biden that he can’t proclaim a mask mandate, so he has now promised to beg governors to do it. Even after finally admitting this, he is claiming that a national mask mandate will save 100,000 lives by the end of the year, even though it’s physically impossible for a mask to prevent even one infection, and has forgotten already he can’t mandate this. Biden’s campaign on a platform of stupidity in this race is simply alarming, but his great success in duping the electorate with it is much more alarming.

Donald Trump is by far the frontrunner as far as listening to the actual experts and not just relying on some people whose expertise actually is limited to vaccines. Biden is at least professing a more cautious approach to vaccines, although neither is expected to put up any real fight once this is ready, as Joe is more than happy to listen to vaccine “experts” who are heinously biased in favor of them and have a huge financial stake in the matter personally as well, as Dr. Fauci and Dr. Redfield both do.

If Trump is No Longer Around to Tell the Truth, We Will Be Alone

Trump’s waffling on COVID in general is no doubt due in large part due to his handlers wanting him to tone down the controversy here, and the expectation is that if re-elected, he may be expected to return to opposing the official narrative more, things like deservingly calling Dr. Fauci and his gang a band of idiots and sticking to this rather than being so apologetic and feigning much more support for their policies and views than he actually holds.

With Biden, we can count on an escalation of these harmful policies, which is the last thing both our economy and our people need. The consensus among the actual experts is that our response to COVID has been hideous, and Joe has more hideousness in store for us given the chance. This issue is therefore a huge one and one that will take us much further down the pit should this hoax be allowed to be perpetrated with even greater force.

Biden is criticizing Trump for allegedly looking to downplay the pandemic early on, where Trump admitted this but claims to have done it not to panic the people unnecessarily. We did not need Trump to tell us that this virus was dangerous, as the rhetoric at the time was that this may end up being be the worst apocalypse the world has ever faced, comparable or even worse than the Spanish flu that killed up to 100 million people, and perhaps even worse than the bubonic plague that killed a third of Europe.

We stood with Trump back then as this was a colossal exaggeration of the actual threat, as time bore out, although it didn’t take much sense to wish to seek to correct this exaggeration as Trump did. Biden claims he should have alarmed us even more, as if the sky is falling wasn’t enough. He needs to be less apologetic about this now and do more to clarify this stance as being the reasonable one, and not the brutally deceptive one that Biden and the Democrats are using to try to not only discredit him but accuse him of mass murder. Then and only then will people see how preposterous Biden’s view actually is.

President Trump has done a terrible job of dealing with these attacks, which have created enough of an advantage for Biden that this is likely even primarily responsible for his edge. If Biden wins, his completely fraudulent and asinine portrayal of Trump’s handling of the pandemic versus what he would have allegedly done will tell the tale of the tape.

Aside from the fact that it is foolish to think that mask mandates will be created just because Uncle Joe asked, now that Biden knows that this is not under presidential authority, Trump’s crimes now come down to his not trying to order other levels of government around. We perhaps should be comforted by Biden insisting that masks work, period, as he states it, but while we don’t want to count his lack of credentials here, we at least should demand more than just Joe saying it, given that masks have never been shown to prevent viral infections because they do not filter out viruses which are too small and pass right through any mask.

Instead of just killing 225,000 people, we at least have the deaths blamed on Trump down to the 100,000 that Biden is now claiming a national mask order would have saved, not that the president has this power, and even though there is no reason to think that a single death could have been prevented by this. The evidence actually shows that masks make COVID infections worse by re-inhaling a virus that the body is trying to expel through respiration, in addition to the practice being shown to impair immunity by lowering our oxygen levels.

It is bad enough that this quackery has been so widely adopted, and we can only shudder at the prospect of losing the only real world leader that has stood at least partly on the side of science and replace him with someone who has swallowed the whole fraud hook, line, and sinker, and has made it his mission to further promote these lies and continue to use a campaign of ignorance to hold the country hostage.

Biden’s plan to control the pandemic has now withered to his promising to do 7 times more tests, which is simply hilarious. Measuring the progress of the pandemic by looking at cases is like sending someone out for a certain period of time to pick apples, and on the next day, sending them out for twice as long, where they pick twice as many, and this means there are twice as many apples on the tree.

7 times the apples on the tree will make the pandemic look 7 times as bad and scare people 7 times as much, no doubt greatly increasing the cry for lockdowns. Trump has tried to speak to this utter nonsense, but he didn’t do that great of a job as this idiocy still rules the world. We’ve already seen this in action, as when the peak cases of August dropped down, they just tested twice as much and they are back up there again, tweaking up the lockdowns. No one could have dreamed up this madness as a work of fiction, and the truth can indeed be stranger than fiction.

There are significant economic consequences to all this, all of it needless, and as the truth slowly emerges about just how big of a public policy catastrophe this has been, the blood will be on Biden’s hands, and there’s no telling how much longer he can keep this recession going, especially with ideas such as our needing to social distance for years more or maybe even forever. This is what you really call throwing gasoline on the fire. Biden and the fake news have created a cult of stupidity, and no one in a cult actually thinks that they are in one or question any of it, which rings true with this one as well.

Another popular issue is climate change, and this one obviously plays big on the economic front. Just like Biden and others want us to ignore the economic effects of public health policy, they also want us to ignore the economy when it comes to climate change, and taking an ignorant perspective is not a good way to proceed or manage things.

Biden wants to get rid of fossil fuels, and while that may be a worthy goal, given that they do pollute, there are practical considerations involved. The first thing you need is an efficient way to replace them, and we simply do not have one at this point. Our economic survival depends on a steady and sufficient supply of fossil fuels, whether we like it or not, and we aren’t even close to a technology that can replace it, an idea that is decades away.

Biden and his gang simply want to do this anyway, in a manner that is both reckless and stupid, and feels that global warming is such an existential threat that we need not even bother looking at the consequences of his response, whether his goals are even possible, and what it would cost ultimately to implement them. If we get rid of fossil fuels before we can survive without them, we will be choosing not to survive, and people will be forced into revolution to bring back fossil fuels before they starve to death.

Trump wins on this point for the same reason that he clearly wins the coronavirus debate, due to his at least trying to account for all of the factors prior to deciding what the best approach is. It is clearly a benefit to have less pollution, and no one would argue with that, but we need to do it in a way that does not involve causing great economic harm. Biden embraces this harm as a badge of courage, and this should scare us considerably.

The candidates’ positions on immigration also have the potential to impact the economy, especially given the contrast between the protectionism of Trump and the very liberal stance on immigration that Biden holds.

More liberal immigration isn’t all bad for the economy, but as Trump points out, if you open up the borders too much and offer all sorts of social benefits to immigrants, we will be overrun, and this will be tragic for the government and the economy. The private sector loves more immigration, as this causes the cost of labor to decline, but on the public side, this can expand deficits that are already way out of control.

Someone needs to pay for this, and the someone is the American people, through the need for higher taxes as well as siphoning off funds that need to be allocated to other projects, which become diminished by way of necessity. Trump wants to protect current Americans, while Biden wants to benefit more foreign nationals by inviting a lot more of them to the party and even promising to pay their way, at the expense of current Americans. This approach will further harm our economy if allowed to be implemented.

When asked about his plan of a $15 federal minimum wage, Biden made a fool of himself during the second debate when he spoke about how we presumably need to do this to protect businesses. Trump pointed out that this would harm businesses and cause them to have to lay off even more people, with more of them being forced to go under with such an action, and felt that this should be left up to individual states due to their being in different circumstances.

Among Biden’s gaffes was his telling us that raising the minimum wage this much would not cost jobs. The CBO studied this and determined that raising the minimum wage this much would cost the country 1.3 million jobs. The worst part is all of these job losses will occur among those who make the least amount of money, who are the ones that would be thrown out on the street. Biden denies this, as he does with anything that does not suit the false narratives that he pitches.

A federal minimum wage of $15 would be harmful to all, to the businesses who now have to pay this higher wage, to the workers who will have less opportunities, to consumers who will have to pay more, to the economy which gets shrunk considerably by this tactic. The jobs that cannot be supported at this higher wage will just go away, and in the end, those left still employed will earn more but the labor market itself will earn less overall due to all of these lost jobs.

The market can only pay so much, and by reducing this by needing to raise prices for things, this will shrink the overall market and less will be available for wages overall. This benefits no one, save for all those extra immigrants that Biden is hoping for, who will find many more under the table jobs available.

Biden Will Be a Nightmare for the Economy

Law and order and the issue of race have become very entwined of late, with all of the riots and protests against the police that we have seen. Biden has been far more embracing of these riots than Trump has, supporting such ideas as rioting and looting is even justified due to their ridiculous focus on a few isolated incidents that have been blown up in the media.

The issue has deteriorated to the point where even in cases where there has been no wrongdoing by the police, riots occur to protest their actions anyway, causing economic harm. The very idea that we need to address isolated incidents not by addressing the problem itself but to use this to attack law enforcement in general is a stupid and harmful idea, and one that has economic consequences as well.

Biden has waffled on this a bit, as he has with several issues, but the will of his party is to reduce policing. He may think that he is the Democratic party, but this is just one of his many delusions, and while the Democrats may not want to fry the pigs like bacon as many in the Black Lives Matter do, they at least want to cull the herd of those who they also substantially consider to be racist pigs, without cause.

This movement is very ironically serving to promote more and not less segregation, as evidenced by a new policy in Seattle which is now requiring employees to be segregated by race. This has the potential to turn back the clock 100 years where racial progress is concerned. They are not seeking to eliminate racism, they are only serving to promote it, and in a very profound way, with Joe and Kamela nodding along.

The scariest thing to come out of this feud is the idea that Trump is throwing gasoline upon racial fires by daring to oppose rioting and looting. The response to this in Democratic states and cities has been atrociously inadequate, and Trump even daring to use federal agents to protect federal courthouses from being burned down by the mob is drawing comparisons to Hitler, that’s how far off the deep end the Democrats have fallen, into the realm of clinical madness that the best medication we have may not be able to resolve.

This is not anywhere near as big of an issue with the economy as some of the other issues are, but all this bears on it. We might think that the same might be said about the issue of media censorship, which Biden is in much more favor of allowing than Trump, who has taken the brunt of this censorship, but this affects the economy in a much bigger way than we may think.

How this affects things is to allow for the Democratic narrative to not only be emphasized but to stifle opposing views, to allow the economic destruction they have planned to stand virtually unopposed, to obfuscate the issues and use deception to shape public opinion, to our great detriment. Don’t count on Democrats to protect us while their side continues to be shamelessly promoted in a way that the pursuit of truth has been replaced with the promotion of propaganda.

Health care is another contentious issue, with Biden demanding that socialist health care be expanded, what he now calls Bidencare, with Trump supporting a more limited involvement, with those who need social health care provided it without upending the current market system that we now have.

It’s not that we could not benefit from a more efficient health care system in the United States, as what we have is clearly broken from an economic viewpoint, and Trump has at least tried to step in here and help Americans with the grossly inflated costs of prescription medicine in the U.S. compared to other countries, being several times more expensive due to a lack of a free market.

We do need more regulation overall to better ensure that market forces are allowed to play out like they are supposed to, looking to avoid these much higher costs for consumers. Biden wants to upset the whole applecart though, and while it is not unreasonable to address those who cannot afford health insurance, the best way to do this is to seek to make it more affordable for them, and for everyone, not look at the underinsured exclusively and seek to place an economic burden upon everyone else to achieve this, where the poor pay less but those reasonably well off or better pay more.

This is not something that promotes economic efficiency very well, and this is the case with all socialization, where the objective becomes something else besides market efficiency and we therefore suffer a loss of efficiency. We do need fundamental change, but we need to make sure that we actually seek to improve the situation overall and not just favor certain segments and serve to harm the overall situation, something Biden has no qualms with.

We Need to Beware the Dramatic Political Change Afoot

The Democrats’ becoming so much more radical in their political views, now favoring socialist ideals that are way out of character for the country historically, will both serve to harm economic growth and fiscal policy. There is only so much that governments can spend, and socialism both reduces the income of governments and expands their expenditures. This is just a way to put more people out of work and on the dole, and with more people collecting and less people paying, these things do not end well economically.

Biden wins on the tariff issue, and tariffs are like taxes insofar as that they tax imports and take this money out of the economy. While neither candidate seems to have much of an understanding of this, the main reason why China supports Biden so much is that he is less prone to charge tariffs, even though it’s not even clear what he wants to do with his double-talk about forcing China to comply to some sort of international standard that only exists in his mind.

The issues are therefore not entirely one sided, and Trump’s love of tariffs which he uses to punish the American people with, and his zeal for a vaccine, both stand firmly against him as far as progress goes. When we look at the overall analysis though, Trump comes out well ahead overall, and especially when we set aside all the nonsense like Trump killed people and the economy, or that he is fueling racial divide by seeking more law and order. This is especially one-sided when we approach all this from an economic perspective.

Trump is clearly pro-economy, and has managed to expand it very well in his time in office, reducing both taxes and regulations, both of which constrict the economy.

Biden is eager to take us in the other direction, and while he crows about how many jobs he plans on creating by doing things like tearing down buildings so that they may be rebuilt with smaller windows, his plans do not account for the overall economic effect or even how these extra jobs will play out in the face of all the jobs that get lost due to his economic plans.

It should not even be controversial that Biden’s tax and regulate plan will contract the economy, as this is what these things do. We’ve spoken about this at great length in past articles and the only way that Biden’s plan does not contract things is if he has a genie that has the power to override the laws of economics.

We do not expect him to be able to produce one, and people will pay for this with higher prices, higher unemployment, and more business failures. This is not a time to trash the economy with the way that it is already struggling from the senseless way that we are trying to hide from a virus that only increased the death toll and continues to do great harm to the economy even though we have opened up more now.

Biden and the Democrats are opposed to “shareholder capitalism,” and think that investing is something that only the wealthy partake in, with this not mattering to the everyday folks that he is aiming his soapbox at. Over half of Americans own shares in companies, with their retirements plans hinged on the price of these shares continuing to rise, plans that will be dashed if Joe tears this down like he promises to do.

Biden is clearly not out to benefit the wealthy, or the middle class as it turns out, and he and his comrades remain obsessed with the poor, not realizing that his plan will harm all of us, even the poorest, by raising the cost of everything for everyone.

As investors, we are in the upper half of the spectrum and have Biden’s guns aimed directly at us, where a combination of a declining economy and specific efforts to bash investors such as getting rid of capital gains tax benefits and other regulatory changes, including even damaging retirement accounts, will add to this pain.

Incredibly, Biden has a big lead over Trump with those invested in the stock market, with their somehow thinking that Biden will serve their interests better than Trump, who famously promotes the value of investments and the strength of the economy, with Biden vowing war on the market.

The massive amount of spending that Biden and his party has planned will take a bad fiscal situation and make it a lot worse, in a way that cannot be undone. American’s exploding deficit is a huge issue, and one that has been virtually under the radar, in the same way that we approach this pending crisis normally, but the flames will grow much higher under an utterly reckless Democratic regime.

Each trillion we go further in the hole means more of the government’s spending needs to go to pay down this debt, and the trillion dollar a year deficit that we have worked ourselves up to prior to the pandemic has already exploded due to our wrecking the economy over this and mortgaging the future of our children to seek to pay for this colossal mistake.

Joe is getting ready to accelerate this a lot more, and this is not just a matter of riding out the storm, as these egregious excesses will remain on our balance sheet forever, until the country finally goes bankrupt, and we’ll never be able to repair the great damage along the way. It will be permanent.

Perhaps the most alarming issue, and one that does factor into the economy ultimately, is Biden’s alarming mental decline. At various times, he has demonstrated that he has already gone over the edge, still thinking that he is running for the senate at times, and even believing he is running against “George.”

You would think that he could remember Trump’s name this far into the campaign, and this in itself would make a candidate eminently unqualified, but no one seems to care that we’re turning over the country to someone this demented. We can only wonder how long his party will be able to prop him up, given that Biden needs to keep it together for 4 years with his mind fading so fast. As bad as Biden will be, Harris is even more hard core and will surely intensify the damage to the economy and the country that their administration will inflict upon all of us.

We’re already seeing the market retrace the correction-sized move we saw last month as the election nears. This is a time where things may not have broken down all that much yet, with the Nasdaq down 7% since Oct 12. We have been surprised that the market has waited until now to do much flinching, but the storm that we have seen approach is very close now, with rain from the outer bands starting to hit the ground, especially on Wednesday.

Playing chicken with an electorate that is on the brink of epic political change, one that simply cannot be good for the stock market, is more than just taking on more risk, and this will take us to a place we have never been before, with a wave of radicalism that makes FDR look like a conservative.

Things have already gotten too risky for our blood, and this isn’t even a matter of knowing how bad the damage may be, just knowing the potential is plenty enough to scare. The storm is nigh, and it’s likely about to get worse, probably a lot worse. Some think the market will rally for a while at least with a Biden win, many think it will take a hit, but one thing we can all agree on is that the risk now is very high. As lawyers will tell you when you face a lot of risk, govern yourselves accordingly.

Ken Stephens

Chief Editor, MarketReview.com

Ken has a way of making even the most complex of ideas in finance simple enough to understand by all and looks to take every topic to a higher level.

Contact Ken: ken@marketreview.com

Areas of interest: News & updates from the Federal Reserve System, Investing, Commodities, Exchange Traded Funds & more.