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Stock Market Gains Were Higher Under Obama Than Trump

November 22, 2018

gettyimages-632311492The Dow Jones Industrial Average, a measure of 30 large, public companies that often serves as a stand-in for the health of the stock market in general, is up less at this point in President Donald Trump’s presidency than it was for President Barack Obama at the same point during his time in the White House.

The comparison comes as economists predict that a recession is imminent, and Trump continues to hang his hat on stock market growth while insisting that the economy will thrive under his eye.

When asked if markets might be heading toward a downturn, Trump’s top economic adviser, Larry Kudlow said Tuesday that he does not “even remotely agree” with negative predictions. Recent downturns, he said were just corrections and recession talk was the “weirdest” thing he had heard lately.

Trump sang a similar tune during a reporter scrum before he made his way to Mar-a-Lago on Tuesday. He did, however, place any blame of a market downturn on the Federal Reserve. “I’d like to see the Fed with a lower interest rate. I think the rate is too high. I think we have much more of a Fed problem than we have a problem with anyone else,” Trump said. “I think your tech stocks have some problems,” he added, before saying he thought they would bounce back quickly.

The president has made a habit of taking credit for a thriving stock market, but deflecting blame on the Federal Reserve or Democrats. “You’re seeing what’s happening with the stock market. People are appreciating what we’re doing,” the president said last January.

“Unprecedented success for our Country, in so many ways, since the Election. Record Stock Market, Strong on Military, Crime, Borders, & ISIS, Judicial Strength & Numbers, Lowest Unemployment for Women & ALL, Massive Tax Cuts, end of Individual Mandate – and so much more. Big 2018!” he tweeted later in the month.

When markets began to sour earlier this month, however, the president said it was because of Democrats winning big in the midterm elections. “The prospect of Presidential Harassment by the Dems is causing the Stock Market big headaches!” he tweeted last Monday. There is no evidence to back these claims.

As of Wednesday morning, the Dow has grown 25.69 percent since Trump took office. At the same point in Obama’s presidency, the Dow was up 40.94 percent.

Analysts have speculated that the market sell-off comes as investors brace for the impacts of the president’s trade wars with China. This year has brought unprecedented market gains, and investors are preparing for a less dazzling 2019 as they balance new tariffs with increasing Fed rates and less growth from the Republican tax cuts.

“Put simply, stocks have already started to price in the risk of an economic slowdown,” Goldman Sachs chief U.S. equity strategist David Kostin wrote Tuesday.

Cumberland’s David Kotok said to Ben White of Politico that people are panic selling. “Washout comes at any time in panic selling. This is what one gets from a Trade War. Thank you Peter Navarro,” he said. “Now up to POTUS to make a truce in Buenos Aires [at the G20 summit later this month]. Then everyone wins. No truce, everyone loses more.”


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