It is usually Donald Trump who is touting his power over the economy, but a Biden win could be the best thing for the U.S. economy, according to financial services giant Goldman Sachs.
A “blue wave this November led by Democratic presidential nominee Joe Biden would lead to a surge in economic growth,” Goldman predicted, according to Business Insider.
Goldman’s chief economist, Jan Hatzius, explored the possibility of a Biden blue wave in a note sent to clients on Monday. He acknowledged that a Democratic sweep would mean an increase in corporate taxes, but predicted the benefits of a stimulus package would outweigh new taxes.
A Democratic-controlled presidency and Congress would increase the probability of a fiscal stimulus package worth at least $2 trillion to pass shortly after the presidential inauguration on Jan. 20. This is important because it would increase consumer spending and thus boost the economy, experts say.
Those spending increases would “at least match the likely longer-term tax increases” on corporations and higher-income earners, Hatzius said.
But a blue wave would have “mixed implications” for U.S. stocks, as Biden is advocating for a 7-percentage-point increase in the corporate income tax rate, to 28 percent from 21 percent, Goldman said.
On the positive side, a blue wave would result in an “easier U.S. fiscal policy, a reduced risk of renewed trade escalation, and a firmer global growth outlook,” Goldman concluded.
Twitter is taking note of the Goldman Sachs prediction.
“When the banks start asking you to vote democratic, that is a HUGE SIGN” Michael Francis tweeted.
Moody’s Analytics is also predicting that a blue win would be good for the economy, including the creation of 7.4 million jobs.
But not everyone is convinced. “goldman sachs has been wrong about everything for the last 5 years” potashrules @potashrules tweeted.
Listen to GHOGH with Jamarlin Martin | Episode 73: Jamarlin Martin Jamarlin makes the case for why this is a multi-factor rebellion vs. just protests about George Floyd. He discusses the Democratic Party’s sneaky relationship with the police in cities and states under Dem control, and why Joe Biden is a cop and the Steve Jobs of mass incarceration.
Since leaving Walter Reed Medical Center, Trump has been sending out erratic tweets about the economy, lending many to question his motives. For example, first he tweeted he would not pursue a stimulus package and ordered his team to stop negotiations, The Washington Post reported. He said if he was elected he would sign off on a stimulus package — seemingly holding payments to citizens hostage unless they vote for him. Then hours later he declared that if Congress created a “standalone” package for $1,200 payments to millions of Americans, he would sign it immediately.
“I am ready to sign right now,” he tweeted. “Are you listening Nancy?”
