Obama Tops Wall Street Rankings
Dorfman, John, Tribune-Review/Pittsburgh Tribune-Review
The stock market has performed better under President Obama than under any president since World War II.
According to my calculations, the Standard & Poor's 500 Index has risen 15.50 percent per year under Obama through Oct. 19. That slightly exceeds the annual rate of 15.18 percent under Bill Clinton, the previous record holder.
No one seems to have noticed this striking fact. And there are a few reasons.
Most rankings of stock-market performance under various presidents cite the cumulative performance for their full tenure. But of course some presidents served more than one term, some exactly one term, and others (John Kennedy, Gerald Ford and Obama to date) less than one. To correct for this, I annualized the stock- market returns.
Many rankings use the Dow Jones industrial average. Mine uses the Standard & Poor's 500, which is a more representative index, comprising 500 stocks instead of 30.
A final reason people might not have noticed the market's strong performance under Obama is that it's an unexpected result. "The market votes Republican," according to one cliche.
Here is my ranking of compound annualized stock-market price changes under every president since Franklin D. Roosevelt.
- Barack Obama, 15.50 percent annualized through Oct. 19
- Bill Clinton, 15.18 percent
- Dwight D. Eisenhower, 10.92 percent
- Gerald Ford, 10.36 percent
- Ronald Reagan, 10.22 percent
- George H.W. Bush, 9.94 percent
- Harry Truman, 8.31 percent
- Lyndon Johnson, 7.61 percent
- Franklin D. Roosevelt, 7.54 percent
- Jimmy Carter, 6.33 percent
- John F. Kennedy, 5.40 percent
- Richard Nixon, -4.04 percent
- George W. Bush, -6.19 percent
I think most investors would be surprised that Obama and Ford rank as high as they do. Conversely, I think some folks would be shocked that Ronald Reagan and John Kennedy don't rank higher.
Obama is viewed by his opponents as anti-business, and even some of his friends don't rate business savvy as among his strong points. The economic recovery under the Obama administration has been anemic. However, he deserves credit for avoiding panic and bolstering public confidence.
As usual, pundits are parsing the polls to see which stocks would benefit if Mitt Romney wins the presidency and which would do best if Obama retains office. Conventional wisdom says that defense stocks would do better under Romney, and I suspect that is right. …