With the US presidential election looming, investors are hedging their bets, driving up the prices of both Bitcoin and gold. Eric Diton, president and managing director of The Wealth Alliance, believes these assets have further to climb regardless of who wins the White House.
In an interview with Yahoo Finance’s Seana Smith and Josh Schafer, Diton expressed concern over the growing national debt, currently exceeding $35 trillion. He pointed out that neither presidential candidate has presented a concrete plan to address this issue. “We just don’t have a plan as a country to deal with this,” Diton stated, adding that he hasn’t “heard any talk about any kind of reduction in spending” from either candidate.
Diton suggests that the bond market reflects these concerns, highlighting a recent rise in 10-year Treasury yields despite the Federal Reserve’s rate cuts. He interprets this as a sign of institutional investors’ apprehension about the growing debt.
While acknowledging the potential for short-term market boosts under either administration, Diton emphasizes the long-term risks posed by the escalating debt. He questions the sustainability of policies focused on tax cuts and increased spending, warning of a potential tipping point where the market demands significantly higher yields on bonds.
When asked about potential investment strategies under each candidate, Diton suggested domestic retailers, fossil fuels, and financials as potential beneficiaries of a Trump victory, citing potential corporate tax cuts and a more favorable regulatory environment. For a Harris administration, he highlighted healthcare as a likely beneficiary, given her focus on expanding Medicaid and Medicare benefits. However, Diton reiterated his primary concern about the national debt, emphasizing that it remains a significant long-term risk regardless of the election outcome. He concluded by expressing skepticism about the willingness of either candidate to address this issue effectively.
