E Market Growth – A History Viewed From A Dow Perspective

Recently I wrote an article and provided a table that looked at the history of market growth as measured by the Dow Industrial 30 over the last 32-years. In that article, I broke down the market growth for that 32-year period by showing how the Dow had changed over each of the last eight Presidential terms. The intended purpose of that article was to negate the claim that the new Trump Administration should be given credit for taking the Dow Industrial 30 crossing the 20,000 mark.

Because the information in that table is so interesting I am showing it again with a different purpose in mind for this article. That table which shows the Dow as it was at the beginning and end of each of the last eight Presidential term follows:

Compounded

President Term  Dow Beg. Dow End. Change Growth Rate Obama 2  13,104 19,873 6769 11.0% Obama 1 8,772 13,104    4,332   10.6% GW Bush 2 10,784    8,772   (2,012)    – 5.1% GW Bush 1 10,791    10,784   (7) 0.0% Clinton 2 6,448    10,791   4,343   13.8% Clinton 1 3,301 6,448  3,147   18.2% HW Bush 1 2,163    3,301   1,138    11.1% Reagan 2 1,278  2,163   885  14.1%

Now before I address the key points that I think should be taken away from the above information, I want to address a few points that should not be taken away.The following are the “non-take-away” points:

It is unfair to give credit or lay blame on the Dow’s growth or decline during a Presidential term to a President; otherwise, using the above information you might come to the false conclusion that Democrats are better for market growth than Republicans—and we all know that could not be possible. The Democrats are the “hand out Party” and the party of financial reform. Republicans are the party of Business and the Wall Street Journal. Forget the Democrats tie to Silicon Valley and Globalization;

It is especially unfair to give the Clinton Administration kudos and chastise GW Bush for the extraordinary and lackluster market growth during each of their administrations. We all know that Clinton’s numbers are “inflated” by the “bubble market” that he left GW Bush in 2001.Of course, keeping that in mind, we also need to take into consideration that GW Bush left President Obama with a market in shambles, too. Less than three months into Obama’s term, the Dow dropped to 6,595—25% lower than the ending period of GW Bush and the starting period for Obama as shown above;

The current Administration is responsible for the Dow crossing the 20,000 mark. In line with the above 32-year history of the Dow, I hardly think so.