Why Investors Are Unfair on Obama

Advertisement

investors hard on ObamaLet’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.

obama approval rating

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.

Third Quarter of 2009 — Dow Up, Obama Down

The Market: The Dow soared 1,208.22 points (14.2%) from 8,504.06 on July 1, 2009, to 9,712.28 on Sept. 30, 2009. The high was 9,829.87 on Sept. 22, 2009, and the low was 8,146.52 on July 10, 2009.

Obama’s Approval: The president’s approval rating fell to 54.4, a steep 8.2-point decline. The high of 60 was recorded the first week of the quarter, June 29-July 5, 2009, and the low of 50 was hit Aug. 24-30, 2009.

Fourth Quarter of 2009 — Dow Up, Obama Down

The Market: The Dow gained 918.77 points (9.7%) from 9,509.28 on Oct. 1, 2009, to 10,428.05 on Dec. 31, 2009. The high of 10,548.51 was recorded on the second-to-last day of the quarter, Dec. 30, 2009, and the low of 9,487.67 was hit on the second day of the quarter, Oct. 2, 2009.

Obama’s Approval: Obama’s average approval rating fell 3 points to 51.4, with a high of 54 the week of Oct. 5-11, 2009, and a low of 49 recorded twice — from Nov. 16-22, 2009, and again from Dec. 7-13, 2009.

First Quarter of 2010 — Dow Up, Obama Down

The Market: The Dow gained 272.67 points (2.6%) from 10,583.96 on Jan. 4, 2010, to 10,856.63 on March 31, 2010. The low of 9,908.39 was recorded at the close on Feb. 8, 2010, and the high of 10,907.42 was recorded on the second-to-last day of the quarter, March 30, 2010.

Obama’s Approval: The president’s average rating slipped to 49.3, down 2.1 points, with a tight range for the quarter. The low of 48 was recorded three separate times, and the high of 51 was recorded twice.

Second Quarter of 2010 — Dow Down, Obama Down

The Market: The Dow fell sharply, losing 1,153.05 points (10.6%) from 10,927.07 on April 1, 2010, to 9,774.02 on June 30, 2010. The high of 11,205.03 was recorded at the close on April 26, 2010, and the low of 9,774.02 was recorded on the very last day of the quarter, June 30, 2010.

Obama’s Approval: The approval rating averaged 47.6, down another 1.7 points with a high of 50 hit twice, from April 19-25, 2010, and from May 3-9, 2010. The low of 45 was recorded the week of June 21-27, 2010.

Third Quarter of 2010 — Dow Up, Obama Down

The Market: The Dow gained 1,055.52 points (10.8%) from 9,732.53 on July 1, 2010, to 10,788.05 on Sept. 30, 2010. The low of 9,686.48 was recorded July 2, 2010, and the high of 10,860.26 was reached Sept. 24, 2010.

Obama’s Approval: The president’s average rating was 44.9, down 2.7 points. The low of 43 was recorded two consecutive weeks, from Aug. 16-29, 2010, and the high of 46 was recorded in five different weekly periods.

Fourth Quarter of 2010 — Dow Up, Obama Up

The Market: The Dow gained 747.83 points (6.9%) from 10,829.68 on Oct. 1, 2010, to 11,577.51 on Dec. 31, 2010. The low was 10,751.27 on Oct. 4, 2010, and the high of 11,585.38 was recorded Dec. 29, 2010.

Obama’s Approval: The president’s average approval rating was 45.5, up 0.6 points with a high of 48 recorded in the very last week, from Dec. 27, 2010-Jan. 2, 2011. The low of 44 was touched twice — Oct. 18-24, 2010, and Nov. 8-14, 2010.

First Quarter of 2011 — Dow Up, Obama Up

The Market: The Dow gained 648.98 points (5.6%) from 11,670.75 on Jan. 3, 2011, to 12,319.73 on March 31, 2011. The low was 11,613.30 on March 16, 2011, and the high was 12,391.25 on Feb. 18, 2011.

Obama’s Approval: Obama’s average rating was 47.8, up 2.3 points. The low of 45 was tallied March 21-27, 2011, and the high of 50 was recorded two consecutive weeks from Jan. 17-30, 2011.

Second Quarter of 2011 — Dow Up, Obama Down

The Market: The Dow gained 37.62 points (0.3%) from 12,376.72 on April 1, 2011, to 12,414.34 on June 30, 2011. The low was 11,897.27 on June 15, 2011, and the high was 12,810.54 on April 29, 2011.

Obama’s Approval: The president’s average rating was 46.6, down 1.2 points. The low of 43 was recorded three separate times, with a high of 51 recorded the week of May 2-8, 2011.

Jeff Reeves is the editor of InvestorPlace.com. Follow him on Twitter via @JeffReevesIP and become a fan of InvestorPlace on Facebook.


Article printed from InvestorPlace Media, https://investorplace.com/ipm_invpol/investors-too-hard-on-president-obama/.

©2024 InvestorPlace Media, LLC