It's said that the first hundred days of a President's term in office are often the most important. They set the tone for their term and the decisions made will lead to a cascade of issues that will define what the next four years will look like. With that in mind, let's take a look at what the first hundred days of a Biden presidency could bring us. After all, elections have consequences.
For better or worse, Biden's flip flopping on fracking and his determination to move away from fossil fuels will lead speculators at the NYSE's commodity markets to go nuts. They've already climbed since May's low of $16.69 per barrel, with Joe Biden's winning of the primary, his backing of the New Green Deal, and his statements against fossil fuels, and they're now sitting at $38.48 per barrel. It's not out of the realm of possibility that the speculators will drive the price back over $55.00 per barrel in an attempt to try to get while the getting is good. But what does that mean for you? Well, like it or not, speculators drive the gas prices. What they offer per barrel directly determines what you'll pay for that gas once it's been refined and distributed. This means that Texas should prepare for $3.00+ per gallon gasoline by May and states like California and New York should prepare to be back over $5.00 per gallon.
401K & STOCK INVESTMENTS:
Unless you already have a precious metals hedge, thank the Lord that I do, you're likely going to be greatly upset by the performance of the market. Joe Biden's tax rate hike on corporations will immediately cut into profits which will suppress profitability outlooks and will cause market shares to drop. Most companies will begin looking to move back overseas to save the taxes, and that means extra expenses and rehring/building. This will further depress market shares and you're likely to see a large drop in your 401k.
Will the market recover? We don't know, but what we do know is that this, coupled with another potential COVID lockdown, will drive stocks into a free fall and will eviscerate the Trump gains. I hope you aren't looking to retire any time soon, or have a family member who is, because they are about to lose their shirt. I hope it recovers, but for many it won't be fast enough even if it does.
HEATING & ELECTRIC COSTS:
Back to the speculators. Guess what? Natural gas? Coal? All of those things that we depend on to power and heat our homes? They're sold on the commodities market too. That means that they too are subject to the speculators and that you're likely to see a major jump in prices as they will be worried about regulations killing their businesses and profits. Coal has already jumped since May from $38.75 per pound to $51.05. It's likely to go up from there. Ditto Natural Gas ($1.616 per unit in may to $3.059 per unit now) which means that both our heating and electric costs are about to go up just in time for winter. Now doesn't that make you feel all warm and fuzzy? No? Well, it is winter, a time of suffering, so perhaps it's deserved.
And before you say that they go up every winter, they generally do (sometimes dramatic others not), but the Nasdaq tracker shows that when the political establishment starts talking about going away from fossil fuels like natural gas and coal, there is a spike in prices. It's not always long term, but the spikes are clear. The fears that a Biden win could cause in the market could easily lead to a big one.
"ASSAULT WEAPONS" EXECUTIVE ORDER:
Well, here we go again. And before any of you hope that there is some kind of grandfather clause to be included, both Harris and Biden have said that they have no intention of including one. That means that government "buy backs" are likely to be put forward, and the only saving grace is that Amy Coney Barrett is now on the court and will likely side with the 2A crowd and declare such an order unconstitutional.
This will attempt to make criminals out of many good people in our country, and if you think for one minute that they'll turn their weapons in? Well, you can just dissuade yourself from that notion, because aside from a handful of people on the fence on this issue? Most people who would give up their guns already have.
Yep, sorry, but it's coming. You see, corporations are in business to make money, not to take care of workers. When they are now facing the specter of higher taxes, harsher (and more expensive) environmental regulations, and increased health care costs, well, it doesn't take a rocket scientist to see where that will lead.
Some will move outright, and all of those jobs will be lost. Yet some will try to stay, but will have to downsize their work force to keep the P&L in balance. A $15 per hour minimum wage? Go ahead, see what happens. The more expensive a person becomes the cheaper a robot or automation is. Just ask the Auto Industry...
All of those expanded government programs? Well, you'll need them, because those job losses will hit a lot of people.
It never ceases to amaze me at how people listen to Democrat promises as if they have some kind of magic wand and as if they can just "make it happen." Yet, as we know from Obama's tenure, they don't. Businesses react and respond to stimuli. Give them reason to move and they will. Make it more expensive to stay than to move? They'll move so fast you won't be able to blink. We're going right back to Obama and his magic wand. Remember when he said that those businesses aren't coming back? Well Trump got them back, and now they're just going to leave again. What a short lived victory.
Yet people often don't think beyond their own emotionalism. They hated Trump and they didn't care what it took, he had to be gone. Be careful what you wish for, because it's not true that everything will happen just as Biden promised it, because he's not a dictator, and those companies have rights too. Articles of Incorporation are so easy to move and reflag.
So, my suggestion is that you begin putting some money away, and into something tangible if you can. Start looking at your own vulnerability. Just remember, if the cost of taxes and regulation compliance become greater than the cost to ship the goods to America from somewhere else with a lower rates, then our companies and jobs will be gone so fast you won't be able to blink. Things are potentially about to get really rocky.
They say that in the United States, we get the government that we deserve. If in fact Biden has won, then we'll get what we deserve, and I'd better not hear anyone who voted for Biden complaining about it, you got exactly what you voted for.