Just for fun
July 30th, 2008 by AriJust for the heck of it, I decided to play a little presidential game. We hear far too often which party or candidate is good for this issue or the other. Let’s look over the past 100 years, and see who has been “good” for the stock market. I managed to dig up the historical price data for the Dow Jones Industrials Average and figured out how the market did on each president’s watch. Here are the results:
| President | Date of prior market close | DJIA when taking office | DJIA when leaving office | Change (%) |
| George W. Bush | 1/19/2001 | 10,587.59 | 11,397.56 | 7.65 |
| Bill Clinton | 1/20/1993 | 3,241.95 | 10,587.59 | 226.58 |
| George H.W. Bush | 1/20/1989 | 2,235.36 | 3,241.95 | 45.03 |
| Ronald Reagan | 1/20/1981 | 950.69 | 2,235.36 | 135.13 |
| Jimmy Carter | 1/20/1977 | 959.03 | 950.69 | -0.87 |
| Gerald Ford | 8/9/1974 | 777.3 | 959.03 | 23.38 |
| Richard Nixon | 1/20/1969 | 931.25 | 777.3 | -16.53 |
| Lyndon Johnson | 1/20/1965 | 895.31 | 931.25 | 4.01 |
| John F Kennedy | 1/20/1961 | 634.37 | 895.31 | 41.13 |
| Dwight Eisenhower | 1/20/1953 | 288 | 634.37 | 120.27 |
| Harry Truman | 1/20/1949 | 181.43 | 288 | 58.74 |
| Franklin Roosevelt | 3/3/1933 | 53.84 | 181.43 | 236.98 |
| Herbert Hoover | 3/4/1929 | 313.86 | 53.84 | -82.85 |
| Calvin Coolidge | 8/2/1923 | 88.2 | 313.86 | 255.85 |
| Warren Harding | 3/4/1921 | 75.11 | 88.2 | 17.43 |
| Woodrow Wilson | 3/4/1913 | 80.71 | 75.11 | -6.94 |
| William Taft | 3/4/1909 | 81.79 | 80.71 | -1.32 |
| Theodore Roosevelt | 9/13/1901 | 67.25 | 81.79 | 21.62 |
Since the great depression, Carter and Nixon are by far the two worst presidents when it comes to guiding the market, with George W Bush and LBJ running closely behind. Reagan and Clinton were by far the best. What’s interesting to note is that Clinton and Reagan had two very different economic plans. Regan increased defense spending tremendously and tried supply side economics to spur growth. Clinton took a very laissez-faire approach to the technological boom, declining to regulate or interfere in any way. (Think sales tax on internet purchases and how many other people would have handled that issue).
These numbers should probably also be taken with a grain of salt. From the numbers alone it looks like Calvin Coolidge had the highest growth in only 6 years time (compared with 8 for Clinton and Reagan), but the over exuberant growth under his administration is what led to the massive crash in 1929.
July 31st, 2008 at 5:38 am
The format of your table is a bit deceiving; you should include the percentage change, with the change taken as a percentage of the starting value. In that case, the numbers would be: -1.61%; -8.60%; 23.2%; 2901%; -26.4%; 4402%; 32.4%; 41.8%; 6.48%; 0.45%; -1.78%; 3.01%; -0.091%; 14.2%; 2.01%; 6.99%, and; 0.072%.
You also got two differences wrong: under Hoover, the Dow actually lost 260.02 points, or 82.8%; under Clinton, the Dow actually gained 7345.64 points, or 2266%. I don’t know how you got your other differences by subtraction…
Finally, as I’m sure you realize, many economic policies take more than a presidential term for their effects to be felt. During the boom of the late 1990s, I recall many economists crediting the policies of Bush and Reagan for allowing for such an economic boom; perhaps some of Clinton’s policies can account for a small piece of our current malaise?
July 31st, 2008 at 6:22 am
All the changes are done as percentages as you suggest. (I added the percent symbol just now to make that clear). The basic formula I used is:
((final_DJIA-initial_DJIA)/initial_DJIA)*100
I don’t know how you got the numbers in your first paragraph. You seem to be trying to assign -8.6% to the Clinton years, which, as you point out in your second paragraph, was a time of significant increase. In the second paragraph you mention percentages for Hoover and Clinton, and those are the exact numbers I have. (Except for the decimal place in Clinton’s time – I think you just mistyped it).