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Politics And The Financial Markets

January 21 2009 by Kerry Kobashi

WallStreet and Politics

Let's do an excercise together, shall we? Lets take the Dow Jones' Industrial Average and find out how each party did during their presidential term since 1900. By doing so we can see if we can gain any insight into the politics of the markets and presidential party terms.

DJIA Performance Through Modern Day Presidential Terms

Years Start End %Change President Party
9/14/1901-3/4/1909 47 62 32% Roosevelt Republican
3/4/1909-3/4/1913 62 60 -3% Taft Republican
3/4/1913-3/4/1921 60 76 27% Wilson Democrat
3/4/1921-8/2/1923 76 90 18% Harding Republican
8/2/1923-3/4/1929 90 310 244% Coolridge Republican
3/4/1929-3/4/1933 310 55 -82% Hoover Republican
3/4/1933-4/12/1945 55 160 191% Roosevelt Democrat
3/12/1945-1/20/1953 160 282 76% Truman Democrat
1/20/1953-1/20/1961 282 640 127% Eisenhower Republican
1/20/1961-11/22/1963 640 750 17% Kennedy Democrat
11/22/1963-1/20/1969 750 970 29% Johnson Democrat
1/20/1969-8/9/1974 970 640 -34% Nixon Republican
1/9/1974-1/20/1977 640 990 55% Ford Republican
1/20/1977-1/20/1981 990 1000 1% Carter Democrat
1/20/1981-1/20/1989 1000 2200 120% Reagan Republican
1/20/1989-1/20/1993 2200 3250 48% Bush Sr. Republican
1/20/1993-1/20/2001 3250 10600 226% Clinton Democrat
1/20/2001-1/20/2009 10600 8250 -22% Bush Jr. Republican

Analysis of Presidential Terms In Financial Markets

What can we gather from this?

  • The Democrats never had a losing DJIA performance
  • The best percentage advances came during Calvin Coolridge (Republican) and Bill Clinton's (Democrat) administration
  • The worst percentage declines came during Herbert Hoover (Republican) and Richard Nixon (Republican) administrations
  • The average DJIA percentage return for 7 Democrats was 81% per term
  • The average DJIA percentage return for 11 Republican terms was 46%
  • The total DJIA percentage return for 7 Democrats terms was 568%
  • The total DJIA percentage return for 11 Republican terms was 502%
  • The average return per each presidential term was 59%

Democrats return better stock market gains than Republican adminstrations.

About Kerry Kobashi

Kerry Kobashi picture

Kerry is the founder of KerryOnWorld. He lives in Silicon Valley.

IkeD's picture

Nice info!

You have proven that what most are not in the know about - that Democrats return a higher return than Republicans in the markets. I always wondered about this. Thanks Kerry, excellent work.

NycBoy's picture

Very nice research

Thanks for taking the time to crunch the numbers. This kind of information that is hard to come by and I appreciate your due diligence.

ShootMoon's picture

Super info

This sort of says it all doesn't it? Republicans have had more presidents elected yet their percentage return has been less than the Democrats.

I didn't realize that the Dow dropped 82% when Hoover was in office.

AMiller's picture

Great work

This is nice work and very useful. Thank you

CWhip's picture

NY Times has a good article on this too

The New York Times has a great article on the percentage returns for Republicans and Democratic terms in regards to the S&P 500.

Politics and Markets