If The Deep State Wins, A Crippling U.S. Dollar Crash Could Occur

According to Shadowstats.com founder John Williams, if embattled President Donald J. Trump is “removed” from the White House, a U.S. dollar crash could occur. The outspoken anti-establishment figure believes that this event would undermine the qualities holding “King Dollar” together.

The first of which (and arguably most important) is confidence. Simply put, Williams believes that the removal of Trump—whether engineered through impeachment or coerced resignation— would irreparably damage America’s democratic institutions. With the unprecedented discord currently going on in Washington, Trump’s removal could signal a new age when election results will not be accepted by either side.

“A big factor in the dollar’s value is political stability, said Williams. “If you have a move for impeachment for the President, that will tank the dollar.” Source: “John Williams Warns “A Move To Impeach Trump Will Tank The Dollar,” 

Contrary to conventional thinking, the political tumult which would result if Trump is maneuvered out of power would be enduring. Why? Because there’s little chance that the “losing” side (a.k.a. conservatives, Republicans, the “right”) would accept the alternative. Even if that alternative is Vice President Mike Pence, who has provided support for Trump, but is not an ideological stalwart.

And even then, what happens in 2020? If the Democrats win the White house, do you think Republicans (conservatives) will lay down and roll over after the thorough subversion that Trump has received from the media and his political opponents?  This is roughly half of America we’re talking about here.

No matter what side of the ideological spectrum you reside in, it’s clear that Trump has been skewered and scrutinized more than any U.S. president in history. Although much of that has been a result of his abrasive disposition and political inexperience, it matters not. The die has been cast. American politics now seems destined to be in a state of permanent political sabotage and lack of respect for the winning side.

In summary, political instability is the new normal, regardless of what happens now. But an engineered removal of a sitting president on shaky grounds could cause a U.S. dollar crash. That would be as much for what the situation represents in the future than what it represents in the present.

Economic Problems Would Intensify

Williams has been a vociferous supporter of Donald J. Trump. His support mainly had to do with economic reasons than anything else. If Trump exits stage left, what would happen to the economy? Nothing good, according to Williams.

He already notes that Trump has been neutered in office. For example, Republicans have had two cracks at reforming or repealing Barack Obama’s Affordable Care Act (ACA). With Republican party majorities in both Congress and Senate, and with massive political will from the president all the way down to his constituency, Republicans still couldn’t close a deal.

A deal would have saved at least $1.0 trillion in government spending; money that could have been earmarked for tax cuts. The failure to replace the ACA spells bad news for much-needed tax reforms. And, of course, the soaring premiums that Americans face for their healthcare coverage is still in effect. Says Williams, “This intensifies the problems for the economy, but I can tell you right up front it’s a big negative for the dollar…”

U.S. dollar chart

Indeed, the whole premise of Trump’s economic platform seems to be unraveling. Back in June, the International Monetary Fund (IMF) downgraded 2017 and 2018 growth expectations. This was in part to the belief that Trump’s tax cut “stimulus” would fail. If Trump is replaced, there’s no guarantee that his successor would revive this dogma. Or worse, he might take tax reform in the opposite direction.

Regardless of the direction taken on Capitol Hill, political discord between “left” and “right” is bubbling. Williams believes there’s a real chance of widespread public rioting and subsequent disruption to supply chains. He believes that owning physical gold is the ultimate hedge against the chaos creeping in.

The strength of King Dollar is the key component underpinning society as a whole. A U.S. dollar crash undermines this reality. If most families cannot sustain themselves, political instability becomes a self-fulfilling prophecy.

And with that, I leave you with an ominous warning from Williams: “Given the underlying fundamentals in the markets and in the economy, I think all the components are in place for one of the great financial panics of all time.”

With all the crazy goings-on in Washington D.C., it’s hard to come to a different conclusion.

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