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Investors have been preparing for election-related stock market crash. David Kotok, co-founder and chief investment officer of Cumberland Advisors told in a recent interview for CNN Business, “there is a creeping concern. If it appears too close to call, we’re going to get a market correction as we get closer to the election.”
In the meantime, all we know for sure is that both sides have recruited vast armies of lawyers, and it’s hard to conceive that either President Trump or Joe Biden would rush to hand over the race. Alternatively, it’s being said that there is a larger probability the situation will develop into a “Bush vs. Gore on steroids”, and many on Wall Street are anticipating a sharp stock market crash if that happens. “We’ve been very blessed in [previous] presidential elections,” Hooper completed, “even in 2000, when it was unclear what the outcome was, it was orderly and civilized. There is a fear that it might not be this time. And that could fuel more volatility and selloffs.”
At this point, all Wall Street wishes for is a clear, undisputed winner, otherwise a stock market crash would erupt on the horizon once again. Furthermore, the political drama will not only interfere with financial markets, but it can jeopardize the fragile economic upswing and derail Main Street into a second round of deep recession. The Fed, on the other hand, would have to unleash another massive shoot of printed money to stop the bleeding in the markets, enhancing the size of the debt bubble and adding more pressure to this stock market collapse scenario.
Another aggravating concern to the real economy is that a new surge of corporate layoffs has begun. It seems like the coming holiday season will be very bitter for millions of Americans. The Washington Post published an analysis that points out that the economic collapse boosted by the health crisis is sparking a colossal disparity in social inequalities, “delivering a mild setback for those at or near the top and a depression-like blow for those at the bottom. Recessions often hit poorer households harder, but this one is doing so at a scale that is the worst in generations”.
Ben Bernanke, the head of the Federal Reserve during the Great Recession, said the current collapse is “an even more unequal recession than usual. The sectors most deeply affected by [the health outbreak] disproportionately employ women, minorities, and lower-income workers”. The Post outlined that low-wage jobs were lost at about eight times the rate of high-wage ones, and although the devastation was deepest among the lowest-paid, middle-class jobs were not spared. To conclude, Moody’s Analytics chief economist Mark Zandi highlighted that “there are very clear winners and losers here. The losers are just being completely crushed. If the winners fail to help bring the losers along, everyone will lose. Things feel like they are at a breaking point from a societal perspective”. That is to say, as the dividing line between the haves and have-nots in the United States is pushing both extremes further away, we’ll see millions falling into poverty. Despite the outcome of the elections, America seems to be headed for a horror show, and economic conditions are on the path to get a whole lot worse.
If you liked today’s video, you should check out Michael Snyder’s “Lost Prophecies Of The Future Of America” now available on Amazon. His book is a must-read about the US economic collapse and will provide you out of the box insights about the world around us. And please, feel free to leave a comment on the comment section down below with your insights about what is coming next in this 21st-century depression.
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