Updated: Mar 26
At the time of writing, it looks like it’s on a plate for Joe Biden to take the white house. Off course Trump being the competitor and person he is, doesn’t look like he might go quietly as things stand right now. We are hearing the GOP crying foul and alleging voter fraud in several battleground states and a lot is still to be seen.
The stock market has remained surprisingly steady though and has even seen rallies that are uncommon in times of political uncertainty.
With the supreme court already gearing up to listen to GOP voting complaints as vote counting continues, what does this all mean for your money?
In for a protracted hangover!
If the claims of some GOP operatives like former mayor Rudy Giuliani are to be taken seriously, we could be in for a protracted period of an election hangover. Any victory laps by whoever wins will be met by harsh claims and loud allegations. The keyword here is uncertainty. Uncertainty is a word that has been blotted out by most investors in their dictionaries. Investors don’t like uncertainty and money is allergic to it. The stock market winces in times of uncertainty which could be the case if an outright winner is not decided and acknowledged soon.
Bitcoin health post-election
If we see an extended period of electoral litigation and claims of malfeasance, then the stock market could take a hit. Stock market hits mean an investor rush towards the exit door as safe havens get sought after. Gold has been a fashionable safe haven over the last few months with Bitcoin also seeing massive gains. Bitcoin’s digital gold status could see it claim 2017-like gains in the post-election period if certain factors come into play.
\What a recount could mean for Bitcoin
With the Trump campaign requesting recounts in places like Wisconsin while filing lawsuits in Michigan, we are in for an interesting next few hours. The recounts could be granted and by the time you read this the Trump campaign could still be in with a shout for re-election. If that is the case by the weekend, then the race could be far from over.
That uncertainty word shows up again like an annoying pop-up message on your computer. You could see reduced stock market prices but your crypto portfolio could likely be buzzing. With Bitcoin holding above the $15,000 mark, you could be in for quite a ride. If Trump’s tweets keep getting more and more controversial, it could soon be hello $17,000.
What if Trump pulls an unlikely win?
Biden’s lead has the democrats feeling extra bullish as we approach the end of the election. Joe Biden and Kamala Harris are likely going to Capitol Hill. What if Trump leaves it late and starts “finding votes” all over the country like he claimed the Democrats were? What if he wins PA and tees up a scenario where he has a path to that desired 270 electoral requirement?
A Trump re-election will simply mean business as usual. The next four years will look just like the previous four.
Taxes will remain low which will make certain companies very happy and your stock portfolio will swell. FANG stocks, Facebook, Apple, Netflix and Google, will keep making astronomical gains and if you are invested in those, happy days. You could see a slowdown in Bitcoin rallies and more of a consolidation because the stock market will steal most of the shine. It will be like showing off your shiny sneakers and before you know it, Timberlands are back in style.
What if Joe proceeds to the white house?
What if what looks like the inevitable unfolds without a spanner in the works? A Joe Biden-Kamala Harris win means a lot for the financial world, not just Bitcoin. Capital gains taxes are likely to start eating significantly more into earnings, which means a possible shrinking of stock market prices. Short orders on key stocks are probably getting ready to activate any hour from now. There is a high chance that Joe Biden will soon look to move a huge stimulus package that will see your financial situation improve amid the pandemic.
Like I pointed out in a previous post, huge stimulus packages are great for citizens in the short term. If we don’t get a hold of the pandemic soon enough, then inflation will come out to bite. Printing more money to provide for cash strapped citizens unable to go to work, means a weak currency. A troubled dollar is probably good for your crypto portfolio.
The other scenario is that the Biden team has a very strong first one hundred days. Biden and team do all they said Trump wasn’t doing to combat the pandemic, and they succeed. Hooray!
People can now get that barbershop, restaurant and gym revenue. More attention is likely to go progressive causes like going after big tech. Firms like Amazon that have seen their profits quadruple under Trump will start getting checked. Search engine giant Google is already under the spotlight over anti-trust concerns. Other big tech firms are likely to go through the same scrutiny.
A Biden win, in a nutshell, could see the stock market take a momentary dip as companies adjust to possible inflation and new tax regimes. The crypto market could very well see an influx of new investors who may decide to dump a faltering dollar. A democrat in the white house also means that progressive agendas such as the environment will take center stage.
Blockchain-related innovation around green energy and environmental conservation will get backed by millions of dollars. Do you foresee that $20,000 mark for BTC yet? Democrats are likely to put a lot of money in infrastructure as well. Any Blockchain innovations around infrastructure development will get massive support.
A win-win-win for Bitcoin?
Every scenario points to a Bitcoin win in my analysis. A recount means uncertainty which makes stock markets cough and crypto markets rub their hands in excitement. A Trump unlikely win could see a slowdown in crypto which will eventually pick up with time. A Biden win will see a progressive inquisition into big firm earnings and possible inflation, which could mean large Bitcoin gains. By my humble analysis, crypto investors will be the biggest winners during the election hangover.
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