Trump Will Win And Replace Powell With A Dove
The next move by the Fed will be to lower rates and put pressure on the USD and drive gold much higher.
The assassin’s bullet will hand Trump the election and likely result in the Republicans getting control of the Congress and Senate.
Trump will oust Powell (you’re fired!!!) and his team and put in a dovish leader of the Fed. Rates are coming down as will the US dollar (USD), which will add fuel to the fire of the gold bull market. Gold had a good week last week and ready for a great one this week.
The American jobs market is in a tough spot, while inflation came out somewhat softer, which is giving the Fed some excuses to lower rates. If they see the writing on the wall that Trump is going to win, they may try to curry favor by immediately getting more dovish. It won’t work.
The US dollar (USD) is trading like it is ready for a correction. Meanwhile, gold is in a new rally that looks like it is ready to make a run for plus $2500.
The jobs market is losing full-time jobs, while gaining part-time jobs. It is incredible that the Fed doesn't differentiate between full-time and part-time jobs. Workers certainly do because when losing a higher paying full-time job and needing to take on one or more lower paying part-time jobs is very painful.
Biden and his team are trying to prop up the jobs market by adding government jobs. Those jobs are an economic drain and also signal how soft the job market is. A tough job market is not a good look for the coming election.
Biden promotes his job creation, but that doesn’t fool workers that know the reality of losing higher paying full-time jobs and replacing them with a lower paying part-time job or two.
The Fed is not much better, giving themselves a pat on the back by saying they are fulfilling part of their dual mandate by being at near full employment. Which is a cruel joke, when considering how many people left the job market after the 2008 GFC and Covid pandemic, plus how hard it is for workers when they buy anything and deal with inflation.
They can fool some of the people some of the time, but all workers are feeling the dual pain of a brutal jobs market and devastating inflation.
The inflation is a lot stickier than the Fed thought from their proclamations it was transitory to its ongoing persistence.
But, now they have to start dealing with a much bigger problem, stagflation. The economy is slowing (see reality of real jobs market) and heading toward a recession, while the Fed has lost the battle against the inflation they caused.
The spending of the politicians has painted the Fed into a corner, they created so much debt, that interest to service the debt is over $1 trillion and on its way to $2 trillion and beyond. After 4 years of Trump’s next term, the debt will blast through $40 trillion and could well be 150% of GDP.
That debt to GDP is supposed to only be for basket case economies, not the biggest economy in the world.
The Death Spiral of Debt is here to stay and the world is heading back to the Gold Standard.
Gold is heading much higher, now it is time for the gold stocks to join the gold bull market in a bigly way.
The big catalyst for the gold stocks is immediately in front of us. The second quarter of 2024 saw the highest average price of gold for a quarter by a big margin. Speaking of margins, plenty of gold miners will have huge profit margins during the second quarter.
They will see windfall profits that will catch the attention of generalist investors. Which will prove to be the catalyst to bring gold stocks into the gold bull market.
In Closing
This report was originally planned to be an update on my top gold stock picks. The assassination attempt on Trump’s life changed my schedule.
I will work on the top gold stock pick report and hope to have it out in the next couple of days.
All the best,
Allan Barry Laboucan
Disclosure
Rocks And Stocks News does not make buying or selling recommendations. The reports are for information purposes only. Sponsors pay a fee to Rocks And Stocks News for content creation. The business model of Rocks And Stocks News is to fund research and reporting on the sector, picks and sponsors through corporate sponsorship. We are thankful to sponsors for enabling commentary free of charge to readers and viewers of the reports. When reporting on sponsors it is on behalf of the sponsors discussed in the portion of the report mentioning the sponsor. Before making any investment decision it is important for you to speak with your financial advisors to consider your risk profile. It is also important to do your homework. To help in that process, Rocks And Stocks News means to be a gateway by doing reports and interviews of management of sponsors and picks. The reports and interviews should not be considered investment advice. Allan Barry Laboucan is the founder and owner of Rocks And Stocks News, he has worked in the mining sector since 1993 and has been reporting on the sector since 2005. He has worked with and been mentored by very talented geoscientists in geology, geochemistry and geophysics. He uses the skills he has picked up during his career to assess sponsors and picks in the reports. Whether a company is a pick or a sponsor they go through the same filter and are reported on when important news is made that Allan Barry Laboucan wants to discuss on the Rocks And Stocks News platform. He may own shares in sponsors and picks for investment purposes which he discloses when discussing them in the reports.
