As Republicans gathered to nominate Donald Trump for President of the United States, they witnessed another historic event. Gold hit a new all-time high above $2,500 an ounce.
The monetary metal made gains following the attempted assassination of the former President and his continued surge in the polls. Even Democrat pollsters now admit Trump is now the clear favorite to win the election.
Democrat party elites from the Obamas to Nancy Pelosi to Chuck Schumer apparently see no path to victory for faltering incumbent Joe Biden. Reports suggest they are pushing him to step down at this late hour out of sheer panic and desperation.
The same Democrat machine operatives who made sure their primary elections would ensure Biden would face no serious opposition are now looking to discard their own hand-picked candidate like an old, worn-out appliance.
On the other side, Republicans, with a few notable exceptions, seem enthusiastic about their nominee. But given Trump’s age, the threats made on his life, and the fact that he would be Constitutionally limited to serving only one term, his pick for Vice President carries heightened significance.
On Wednesday, JD Vance took to the stage to introduce himself to millions of Americans and accept the GOP Vice Presidential nomination. A former Trump critic, the young Senator from Ohio drew on his personal background to try to connect with the struggles of blue collar and rural Americans.
Vance, a relative newcomer to politics, rose to prominence following his bestselling book, Hillbilly Elegy.
In the Senate, he has helped lead the anti-Woke culture wars. He introduced the Dismantle DEI Act, which would bar government agencies from implementing Diversity, Equity, and Inclusion quotas. Senator Vance has also sponsored bills to stop transgender surgeries from being performed on minors.
He has irked outgoing Senate Minority Leader Mitch McConnell and other establishment Republicans by opposing billions in aid for Ukraine’s war effort.
On the economic front, Vance favors getting tough on China with tariffs. He has suggested that China and other countries are artificially weakening their currencies in order to boost their exports to the U.S.
According to Vance, a strong U.S. dollar on foreign exchange markets isn’t necessarily a good thing. It makes foreign produced goods cheap relative to domestically produced goods, which leads to a loss of manufacturing jobs at home.
President Trump has made similar points.
Trump is also a proponent of low interest rates. Should he return to the White House in January, it won’t be surprising if on Day One he urges Federal Reserve Chairman Jerome Powell to cut rates further and faster than he presumably will have already done. Futures markets project a near 100% chance of a rate cut in September.
A Trump/Vance administration can be expected to favor weak dollar policies even as it attempts to get inflation down by lifting restrictions on domestic energy production and ending Joe Biden’s Green New Deal deficit spending spree.
Another notable speaker at the GOP convention was Representative Matt Gaetz. He mocked disgraced Democrat Senator Robert Menendez, who was recently convicted on corruption and bribery charges. Menendez had accepted lavish gifts, including gold bars, from foreign agents.
Matt Gaetz: Under Biden-Harris inflation has gotten so bad. You can no longer bribe Democrat senators with cash alone. You have to use gold bars just so the bribes hold value. Oh, the swamp draining will recommence soon, and I will be President Trump’s strongest ally in Congress.
News Report: Former President Trump says he’ll consider JPMorgan’s CEO Jamie Dimon for Treasury Secretary if he wins the election. That’s according to a Bloomberg interview. Trump also says he won’t try to oust Federal Reserve Chair Jerome Powell before the central banker’s term ends. Powell’s term, by the way, is up in 2026, and his seat on the Fed Board of Governors ends two years later. Trump appointed Powell to lead the central bank in 2018.
Sound money advocates aren’t particularly optimistic that Trump will drain the swamp of Wall Street financiers and entrenched central bankers who ultimately control the nation’s purse strings.
But Representative Gaetz is certainly on point about gold maintaining purchasing power much better than U.S. fiat dollars. In terms of those steadily depreciating Federal Reserve notes, gold is now slipping from the higher prices we saw earlier in the week and currently commands $2,416 per ounce and is down a slight 0.2% for the week.
Silver, meanwhile, is giving back its recent gains as well. The white metal shows a weekly loss of more than $1.50 or 5.0% to trade at $29.41 per ounce.
Platinum is dipping 3.8% to come in at $976. And finally, palladium is down 5.3% since last Friday’s close to trade at $950 per ounce as of this Friday morning recording.
Industrial commodities along with economically sensitive sectors of the stock market suffered this week on fears the economy is losing steam. Leading economic indicators are deteriorating. And the number of Americans who applied for unemployment benefits jumped to 243,000 last week.
Dangers loom for stock market investors. Physical precious metals will continue to serve as a safe haven from risky financial assets and the ongoing depreciation of the U.S. currency.
Yes, the election outcome could bring significant changes to Washington. But it won’t change the inflationary nature of the Federal Reserve system. Nor will it change the debt-strapped government’s dependence on it.
