Impact of US Presidents on the US Economy
This page discusses the impact which US presidents had on the US Economy like Employment, GDP and other macroeconomic indicators. Is it really that US Presidents can have such an impact on an economy ? I believe that the Fed would have a far greater role in doing so than the US President.
you're inferring that correlation is causation. the president cannot by him/herself affect the stock market or force the direction of the economy to turn on a dime. POTUS can likely enact policies to continue an uptrend, slow an uptrend, stop the bleeding of a downtrend, or exacerbate a recession, but I've yet to see any studies that show a causal effect between the president and your portfolio.
the author himself even says it: You know my views on Presidents and the economy: Too much credit for when things go right, too much blame when things go wrong.
I beg to differ. President Deals watching 8 hours of cable news a day and getting Mad Online every morning on twitter has a very real and tangible effect on the market.
show me the data.
day by day swings? you might have something?
long term performance? show me the proof.
in terms of things affecting the stock market's performance, these are the things you need to pay attention to (in no particular order)
if presidents had an impact on the stock market's performance you would assume that anti-business presidents would have low returns and pro business presidents would have high returns.
obama was anti business, his returns were some of the best ever because we came out of the worst crisis since the depression
bush was pro business, shitty returns because his 2 terms were bookended by the tech bubble and the financial crisis (exuberance caused tech bubble way before his time, greenspan was asleep at the wheel for GFC, can't pin that on W)
ford (not mentioned) has had the best CAGR of any president ever (albeit a short term), and I don't think anyone believes he's an economic genius
correlation is not causation, and just because you hate trump and see the S&P drop 1% when he calls himself tariff man is not enough to draw conclusions and change your investment strategy
So did Executive Orders under Obama...
Much more correlated with interest rates, which always seem to rise when a Republican is president.
again, show me the data. rates rose under truman and post 1940 FDR, they rose under JFK and LBJ, fell during Nixon (until 73), fell during Ford, rose during Carter, fell DRAMATICALLY during Reagan, fell further during HW, rose & fell during clinton, fell then rose again during W
ERP is also a notoriously terrible predictive metric, so I don't buy the argument that you need ONLY to pay attention to rates
With regard to Reagan, they peaked 1 year into his presidency, declined and then rose again. But they were very high throughout both terms.
right, but what I'm saying is that there's no correlation between the change in short term rates and the party holding POTUS.
you inferred rates "always seem to rise" when there's a republican in office, I'm saying that's not true, though I am willing to listen to other sides.
Average interest rates are significantly higher under Republicans than they are under Democrats. Okay? Get off your high horse.
Don't have studies to back it up, but I think the only impact a president has is on the dollar. Power to go to war, government spending/agenda, monetary/fiscal policy, etc., are all things that will surely move the dollar, and through policy actions or appointments, the president will have direct control/influence.
Poor data under G.W. Bush is heavily correlated to 9/11. Now, if if whoever made that wants to tell me how Bush is responsibile for causing it and enter the conspiracy theory field, he can go ahead.
Similarly, Clinton ''does well'' thanks to the lack of international events that affected the US markets. Obama picked up at the bottom, while Reagan went through the bottom and came on top.
All in all, you pick a selection of indicators, eradicate them from real world context and rank Presidents according to them. Good job. You'll get a job in the academia for that.
2020 baby
Ugh. Why anyone capable of higher level math would waste their efforts on such an useless analysis is beyond me...
No serious/honest economist would take this serious
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