Regardless of their political leanings, serious buyers of gold and investors in all precious metals understand these are very unusual times. This reality is driving a great deal of discussion, particularly in a post-Brexit world.
Many respected analysts and pundits were proved wrong about the possibility of a successful leave vote coming out of the Brexit referendum. As a result, they are now particularly focused on trying to access the ultimate victor in the U. S. elections and what such an outcome will mean to financial markets generally, and gold specifically.
Of course, from the perspective of a long-term investor in gold, it is difficult, yet essential, to separate one’s political view from market factors that will determine gold prices. Regardless of those personal views, it is important to understand how the financial world will view the different outcomes and plan accordingly.
Considering the possible election of Donald Trump in November, there is a decidedly alarmist tint to many predictions. For example, a leading analyst at Dutch bank ABN AMRO sees gold hitting $1,850 or more under a presidency of The Donald. While she discounts that probability, Georgette Boehle of Amro opines, ‘…his rhetoric and possible policy actions could create domestic and international uncertainty at best, and upheaval at worst.’
However, even this pessimistic view of a Republican victory is not offset by a more positive opinion about a Clinton victory. Boehle sees a positive turn for gold regardless, noting the probability of greater inflation, a worsening currency situation, and inevitable negative interest rates.
This post was published at TruthinGold on August 10, 2016.