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Will the Election Ease Our Economic Concerns?

Will the vote matter to your portfolio?

Many national issues will persist regardless of the presidential election’s outcome.

With our nation’s full attention directed toward the highly anticipated U.S. presidential election in November, there’s a natural tendency to take a “wait and see” approach regarding important financial decisions like adding gold and other precious metals to your portfolio.

However, it’s important to recognize that the election's outcome will have little (if any) bearing on major concerns influencing our economy today and into the future. By waiting to make an important financial decision until after the election, you may be missing out on important opportunities today.

Regardless of which presidential candidate or political party is voted into office in November, the following major domestic issues will persist and continue to develop beyond the election.

Chart: Will these major issues change based on which party wins the election?

National Debt and Deficit

According to federal budgets put forth by former President Trump and current Vice President Harris, and based on financial analysis of their proposed policies, national debt and budget deficits are projected to increase significantly under both candidates.

Debt:

The national debt is now over $35 trillion and continues to grow. During Trump’s 4-year term, the national debt increased by $7.8 trillion. And through 3.5 years of the Biden/Harris administration, the national debt has risen by $7.29 trillion. The persistence of deficit spending by both parties over the last two decades suggests that managing the growing national debt will remain a significant challenge for the next administration, regardless of who occupies the White House.

Deficit:

According to analyses by the Penn Wharton Budget Model and the Committee for a Responsible Federal Budget, both candidates’ proposed policies would contribute to rising deficits over the next decade. Currently, 73% of all government spending is for mandatory spending including Social Security, Medicare, and interest on existing debt, and neither presidential candidate has expressed clear plans to address this significant portion of the federal budget. Additionally, interest on existing debt is now larger than national defense spending and the third-highest overall federal expense behind Social Security and major healthcare programs such as Medicare and Medicaid.

Political Climate

The next White House administration, whether Democratic or Republican, will face a world fraught with geopolitical risks abroad and political divisiveness at home.

Geopolitical climate:

The global landscape remains highly fragmented and volatile, with ongoing conflicts in Ukraine and the Middle East, and China’s rising military aggression toward Taiwan and U.S. allies in Southeast Asia. Additionally, many countries—including the BRICS nations—continue their efforts to reduce U.S. political and financial influence over global affairs, which include challenging the U.S. dollar as the world’s reserve currency.

Domestic political climate:

The stark contrast in policy positions, rhetoric, and governing philosophies between the two candidates suggests that the deep divisions in American politics will continue. This ongoing polarization is likely to result in continued legislative gridlock, making it difficult to pass significant legislation on pressing issues such as healthcare reform and immigration policy. Additionally, the inability to address major national challenges through bipartisan cooperation may exacerbate existing social and economic inequalities, potentially leading to increased social unrest and further political instability.

Economy

Despite any promises of economic improvement after our newly elected U.S. President takes the reins of our federal government, the fact is that many serious economic challenges will persist, no matter who’s at the helm.

Inflation:

Both candidates will face ongoing challenges in managing inflationary pressures, which are influenced by complex global factors such as supply chain disruptions, energy prices, and geopolitical tensions. Trump’s proposed tariffs on Chinese imports and other foreign goods could potentially drive up consumer prices, while Harris’s plans for increased government spending on homebuyer assistance and child tax credits might also impact inflation. Additionally, the Federal Reserve’s monetary policy decisions will continue to play a crucial role in inflation management, irrespective of who occupies the White House.

Personal Finances:

Regardless of who wins the presidency in November 2024, Americans’ personal finances are likely to face continued pressure. Both candidates’ economic proposals have been criticized by economists for potentially increasing federal deficits, which could lead to long-term economic challenges. The Penn Wharton Budget Model projects that real wages across all income groups will decline over the next 30 years under the proposals of both candidates.

Slowing Economy:

The growing national debt will continue to weigh on economic growth. The national debt is now over 120% of GDP. This high level of government debt can negatively impact economic growth by crowding out private investment, potentially leading to higher long-term interest rates and necessitating future tax increases or spending cuts to service the debt. Both Trump’s and Harris’s proposed policies are estimated to add to the national debt over the next decade. According to the Penn Wharton Budget Model, implementing either candidate’s policy agenda would result in lower GDP growth over the next 10 years compared to maintaining current laws and policies.

Immigration

Regardless of the presidential election outcome, immigration challenges and associated economic costs will continue to be a complex and divisive issue in American culture.

Economic Implications:

Even if effective policies are implemented to reduce the flow of illegal immigration into the United States, most estimates place the number of unauthorized immigrants already in the U.S. between 11 and 16 million. The economic implications of immigration will remain significant, with debates continuing over the costs of services for migrants and the potential economic contributions of immigrant workers, regardless of who occupies the White House.

Retirement Challenges

Critical factors—including rising costs, increased longevity, and diminishing benefits—will continue to make retirement more elusive for many Americans long after the election.

Healthcare Costs:

While both candidates have proposed measures to address healthcare affordability, systemic issues in the U.S. healthcare system persist. Factors such as an aging population, increasing life expectancies, and technological advancements in medical treatments contribute to the persistent upward pressure on healthcare costs. Regardless of who occupies the White House, as healthcare options improve and the population ages, costs will continue to rise.

Social Security:

Social Security is projected to face a financial crisis within the next decade, with the potential for beneficiaries to receive only about 75% of their promised benefits by 2035 if no changes are made. While both candidates have made commitments to protect Social Security, neither has presented a comprehensive plan to address the program’s long-term funding challenges. Factors such as an aging population, declining birth rates, and increasing life expectancy continue to strain the system, regardless of who occupies the White House.

Retirement Age:

The average age at which Americans stop working and retire continues to increase. The average retirement age was 57 in 1991 according to Gallup, and has increased to 62 according to a 2024 Mass Mutual survey. Several factors are pushing this number upward. The ongoing challenges facing the Social Security system, including its projected insolvency by 2035, are prompting many Americans to work longer to secure their financial future. Additionally, improved healthcare and increasing life expectancies are necessitating longer careers to fund longer retirements. Neither candidate has proposed concrete plans to address these underlying trends.

Don’t wait to add gold

Here are five important reasons to make the important financial decision to buy gold today, not after the election:

Gold is wealth insurance during times of economic and political uncertainty.
Gold prices have risen under every president going back more than two decades.
Gold has outperformed other assets through both good times and bad.
Gold has helped minimize risk and maximize rewards when included in a portfolio.
Gold prices are projected to rise through 2025 and beyond, driven by economic uncertainty and falling interest rates.

With many experts predicting gold prices to reach $3,000/oz. or more in the coming months, now may be the time to add the wealth protection and growth potential of gold to your portfolio.

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