Let’s make a crazy assumption and agree that investors are — at least in part — rational beings. Unless you exclusively worship the black magic of technical analysis, chances are your portfolio is built upon logical assumptions about the headlines and hard numbers like revenue, earnings and so on.
You know, facts.
If this is the case, then why are investors so quick to criticize Obama as bad for the market? Because the hard numbers show that the president has done a darn good job when it comes to the stock market. Yet in the face of the facts, many investors insist the president has done nothing but make their life difficult since taking office.
Here’s a reality check: At Obama’s inauguration, the Dow Jones Industrial Average was at 7,949. Now, even after the August “crash,” the index is over 11,400 — a remarkable 43% gain. The Dow has risen eight of the 10 quarters he’s been in office (though admittedly, we’ll have to see a nice rally in Q3 to see another winning quarter).
Meanwhile, his approval rating has improved in only two of the past 10 quarters. On the whole, Obama’s approval rating as measured by weekly Gallup polls has plummeted from a high 67 from his first days in office to a low of 40 just last week. And in the third quarter of 2009, when the market added over 14% in just three months, Obama’s approval rating took its worst tumble since taking office.
It is the God-given right of every registered voter and a patriotic citizen to criticize Obama’s policy decisions — and trust me, I have beef of my own. But it is more than a little unfair to label the president as bad for stocks or for investors.
I also acknowledge that a president should be graded on far greater issues than the value of the nation’s 401(k) accounts. It is a dangerous thing to put a dollar amount before other values in a president, especially when so many great leaders shepherded America through lean times and a number of also-rans plodded along through moments of relative prosperity.
But come on, Wall Street. Things have been much better than you think — so give the president a break.
If you don’t believe me, look at the numbers yourself:
First Quarter of 2009 — Dow Down, Obama Down
The Market: The Dow lost 340.17 points (4.3%) from Obama’s inauguration at 7,949.09 on Jan. 20, 2009, to the March 31, 2009, close of 7,608.92. The highest closing figure for the Dow was 8,375.45 on Jan. 28, 2009, and the low was 6,547.05 the infamous date of March 9, 2009.
Obama’s Approval: The president saw an average approval rating of 63.6 across the quarter, with a high of 67 in his first week of Jan. 19-25, 2009, and a low of 61 from March 23-29, 2009.
Second Quarter of 2009 — Dow Up, Obama Down
The Market: The Dow gained 685.40 points (8.8%) from 7,761.60 on April 1, 2009, to 8,447.00 on June 30, 2009. The highest close was 8,799.26 on June 12, 2009, and the low was 7,761.60 on April 1, 2009.
Obama’s Approval: Obama’s average approval rating fell a point to 62.6, with a high of 66 from May 4-10, 2009, and a low of 59 recorded June 15-21, 2009.