The Myths We Tell Ourselves - Markets and Presidents

Okay, so I've been getting tired of some things I keep hearing. And you all know I relax by doing math. The latest is the myth, "Markets love Republican Presidents and do better, and hate Democratic Presidents and do worse." I've heard this bantered several times. So I decided to do some research. I had some difficulty finding specific historical DJI numbers (I did want to go back to 1901), but I did find a list of monthly averages going back to 1945 (the only number that isn't a monthly average is for GW Bush's last day). I figured taking the month they entered and left service was a good overall picture. This, of course, ignores high marks during the presidency, but if "markets love Republicans and hate Democrats" I think a start and end should demonstrate just what the markets actually do like. For the time period we had there were more Republican Presidents (6 to 5) and they were in power longer (36 to 28 years). We start with the death of Roosevelt and we cover an assassination and a resignation, the recovery from WWII (and baby boom), the Cultural Revolution, the 70s, Reaganism, the Internet Boom and Bust, and the Age of Terrorism.

Harry S. Truman-Democratic
Start Apr 45, 206.8 points; End Jan 53, 290 points
+83.2 or 140%

Dwight D. Eisenhower-Republican
Start Jan 53, 290 points; End Jan 61, 648.2 points
+358.2 or 224%

John F. Kennedy-Democratic
Start Jan 61, 648.2 points; End Nov 63, 721.6 points
+73.4 or 111%

Lyndon B. Johnson-Democratic
Start Nov 63, 721.6 points; End Jan 69, 946.1 points
+224.5 or 131%

Richard Nixon-Republican
Start Jan 69, 946.1 points; End Aug 74, 678.6 points
-267.5 or 72%

Gerald Ford-Republican
Start Aug 74, 678.6 points; End Jan 77, 954.4 points
+275.5 or 141%

Jimmy Carter-Democratic
Start Jan 77, 954.4 points; End Jan 81, 947.3 points
-7.1 or 99%

Ronald Reagan-Republican
Start Jan 81, 947.3 points; End Jan 89, 2342.3 points
+1395 or 247%

George H. W. Bush-Republican
Start Jan 89, 2342.3 points; End Jan 93, 3310 points
+967.7 or 141%

Bill Clinton-Democratic
Start Jan 93, 3310 points; End Jan 01, 10940.5 points
+7630.5 or 331%

George W. Bush-Republican
Start Jan 01, 10940.5 points; End Jan 09, 7949 points (Closing January 20 2009)
-2991.5 or 73%

The Democratic Party was in control of the White House for 28 years (5 Presidents), total +8004.5 points. Average percentage increase 162.2%.

The Republican Party was in control of the White House for 36 years (6 Presidents), total -262.6 points. Average percentage increase 149.5%.

So there you have it.