Monday, December 05, 2011
An interesting look at stock market cycles in the third year of presidential terms. If the end of the year were today, Barack Obama would be the first president since World War II to suffer a stock market decline in the third year of his first term. Nixon, however, got close, and was only bailed out with a huge rally in the last two weeks of 1971.
Is 2011 like 1971? If so, hang on to your hats.
The linked post also discusses the much greater volatility this year. Consider:
Bespoke had a great piece out last week showing that since August 1st the S&P500 has had eight declines of 5 percent or more and eight advances of 5 percent or more. Contrast that to several stretches in the 1990′s where the S&P500 went more than a year without a rally or decline of 5 percent.
No doubt the consequence of political risk, which is vastly greater today than in the halcyon '90s, Bill Clinton, Newt Gingrich, Monica Lewinsky and Ken Starr notwithstanding.
Obama's policies, not just his economic policies, bode no good. His policies will never result in a strong economy. He told you that when he was running in '08.
He's for low/slow growth and putting America in its place.