Update: For Fun, Stock Market as Barometer of Policy Success – TheTradersWire

Update: For Fun, Stock Market as Barometer of Policy Success

Update: For Fun, Stock Market as Barometer of Policy Success

by Bill McBride on 1/19/2018 11:57:00 AM

There are a number of observers who think the stock market is the key barometer of policy success.  My view is there are many measures of success – and that the economy needs to work well for a majority of the people – not just stock investors.

However, for example, Treasury Secretary Steven Mnuchin was on CNBC on Feb 22, 2017, and was asked if the stock market rally was a vote of confidence in the new administration, he replied: “Absolutely, this is a mark-to-market business, and you see what the market thinks.”

And Larry Kudlow wrote in 2007: A Stock Market Vote of Confidence for Bush: “I have long believed that stock markets are the best barometer of the health, wealth and security of a nation. And today’s stock market message is an unmistakable vote of confidence for the president.”

Note: Kudlow’s comments were made a few months before the market started selling off in the Great Recession. For more on Kudlow, see: Larry Kudlow is usually wrong

For fun, here is a graph comparing S&P500 returns (ex-dividends) under Presidents Trump and Obama:

Stock Market Performance

Click on graph for larger image.

Blue is for Mr. Obama, Orange is for Mr. Trump.

At this point, the S&P500 is up 23.2% under Mr. Trump compared to up 41.1% under Mr. Obama for the same number of market days.

Read more at http://www.calculatedriskblog.com/2018/01/update-for-fun-stock-market-as.html#yRdiQOsKJzw4p9KO.99

Published at Fri, 19 Jan 2018 16:57:00 +0000

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