Via SchiffGold.com,

It looks like Joe Biden will ultimately win the presidential election, although it will likely be weeks before all of the official votes are in and the legal wrangling could go on even longer. One thing that is clear is that the polls were horribly wrong. They were projecting a Biden landslide. If Trump did lose, it was barely.

In his podcast, Peter Schiff offered some post-election analysis and said investors are as clueless as the pollsters.

The projected “Blue Wave” never materialized. It not only looks like the GOP will maintain control of the Senate, they also picked up seats in the House. As Peter put it, the Blue Wave was barely a splash.

Joe Biden barely squeaked in with the narrowest of margins, assuming that the challenges don’t hold up.”

Before the election, Peter speculated that a lot of people might split their ballot, voting for Biden because they dislike Trump, but voting Republican in congressional races in order to keep the Democrat in check.

Wall Street had handicapped this scenario as the worst possible outcome because they perceive a Republican Senate as an impediment to stimulus. In fact, despite the third straight day of gains driven by anticipation of a Biden presidency with plenty of government stimulus, the Dow Jones sold off into the close Wednesday as it became increasingly clear the Republicans would likely maintain control of the Senate.

Anything that would slow down the stimulus juggernaut was going to be bad news, certainly for the market, which is a one-trick pony and that trick being stimulus.”

But Peter said he doesn’t think the Republicans will stem the stimulus tide. He said he does think the Republicans will show a little more backbone with Biden in the White House, “but not much.”

The package will be there. The Republicans are not going to stop the aid. Everybody agrees, unfortunately, that people need help and nobody wants to deny that help. But I do believe that with the Republicans in control of the Senate that the size of the spending plan will be somewhat smaller than otherwise would have been the case had the Republicans not maintained control of the Senate. I don’t think Republicans are going to stop the tax hikes. I do think they will mitigate the size of the tax hikes. So, I do think that corporations and upper-income taxpayers are going to be hit with higher taxes. The blow just may not be as bad as it would have been had the Democrats taken control of the Senate. But I don’t think that the economy is going to be spared either increases in government spending or higher taxes.”

Peter said the stimulus and the tax hikes will act as “an economic sedative.”

And I do not believe it will provide the type of support to the stock market that similar stimulus has provided in the past because I do believe we are going to overdose on that stimulus and the fatality is going to be in the US dollar, and then, of course, by extension, the entire US economy that rests upon the foundation of the overvalued dollar.”

Nevertheless, the stock market celebrated the election led by the NASDAQ. Peter termed it a relief rally. But he said the celebration may be a bit premature if Wall Street really thinks tax hikes aren’t coming just because the GOP maintains the Senate. And he said the real problem will be the increase in spending that’s coming down the pike.

Which means the deficits are going to be much larger, which means the monetary stimulus supplied to finance those deficits, to monetize those deficits, are going to be much larger. And that means the real economic damage will be much greater and the losses far more severe for people who are holding US-denominated assets – particularly bonds.”

Peter said he also thinks the regulatory burden on businesses will increase. A lot of the deregulation during the Trump administration came via executive order. Biden can undo those with a flick of a pen. He can also add additional regulations in the same way.

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Gold hasn’t made any kind of big move in the wake of the election, but it did rally back above $1,900 and has held that level.

Gold really should have had a much bigger move up. I mean, gold is what people should be buying as a result of this election. They should be buying gold regardless of the outcome of the election because the one thing that’s certain is that money is going to be printed. There is going to be a lot of inflation in the future, even more so than what we had in the past, and that means a lot more money is going to go into gold.

The real question is how much longer can the delusion that the outcome of this election is somehow a positive for an already substantially overvalued stock market continue?

Via Zerohedge