DJIA Returns Ranked by President Since 1929

People seem to be in a historical frame of market mind this weekend, so here is a chart of Dow Jones index returns by U.S. president since Herbert Hoover obtained office in 1929. Note that I have given this result in compound annual terms to compensate for the differing lengths of presidential terms over the period.

As an aside, while President Bush is currently running neck-and-neck with Jimmy Carter for the third-worst presidential market returns in history, President Bush is the leader of the pack as far as worst market returns go for two-term U.S. presidents.

Comments

[cmon]

This is pretty low value add. But if you really think stock market returns do reflect on executive policy in some way, then you outgh to look at returns with a two year lag, so that at least the period reflects that President's "time of strongest influence".

[axxum]

Not making a political statement but 6 of Clinton's years were with a Republican House and Senate. More of a statement of how well divided government works than about a political party.

[Chuck]

Two year lag? OMG, G W is then so, so doomed to approach that Dam Hoover !

[mdmrjsds]

This really confirms the old saying about "lies, damn lies, and statistics". :-)

Bill Clinton was lucky enough to have a bubble occur and top during his term, but miss the crash. Sort of like if there had been a presidential term ending just before the crash of 1929, but starting during the run up in 1921. And the outsourcing and offshoring from the free trade agreements he implemented in 1994 really kicked in this century, destroying the middle class.

The results during the last 8 years (and next 8 probably) will be affected by that bubble. Rather than pay the piper, the fed created the housing bubble to try and work their way out. You know, sort of like the wile e coyote keeps spinning his feet and legs hanging over air before he drops. Of course, current policies have an effect too.

There are all kinds of feedforward and feedbacks, lags and leads occuring in an economy as complex as that of the US. So this graph is meaningless. But you already knew that. ;-)

Hey, I wonder what the graph of congressional control would look like in the same terms. Since the democrats took control of congress in 2006, the markets have been terrible. I can just imagine what they will be like after 2008. :-) Socialism is great for markets, that's why they recovered so quickly under FDR. :-^

Truth is, there will be so many of the old fossils that got us into this mess still in congress that nothing is really going to change. Unfortunately. The strength of our political system is that it is very stable. The weakness of our political system is that it is very stable.

[RightinSanFrancisco]

Interesting data. It does call for questions about causation and correlation with other factors, like wars and control of congress. A more interesting correlation might be growth of GDP with a short lag time. One would hope that presidents would take a longer term view of growing the economy, and that eventually the economy would drive the market. But maybe that's a rationalization for why the data doesn't look better.

[BerkeleyBob]

I have been pondering Clinton's term in office. True, he presided over a rising market, which makes everyone look like a genius. His contribution is that he did nothing to make matters worse, and his fiscal policy was essentially sound. There is a profound disconnect between fiscal and monetary policy at present and apparently both the legislative and executive branches have an irresistable impulse to externalize the true costs by pushing them off on future generations...