Most people are unaware of how much better the stock market does under Democrats than Republicans. This could be the product of a full century of coincidence. It could be. In any case, it certainly undermines any claim that Republicans have that they're good for financial markets.
Imagine two families who have $100,000 to invest the day that Teddy Roosevelt is sworn in on 4 September 1901. (September because he was sworn in after McKinley was assassinated.)
The Democratic family loyalists refuse to invest in the stock market each time a Republican is sworn in, putting their money under a mattress until a Democrat is sworn in. Once a Democrat becomes president, these Democrats buy a market index linked to the Dow and hold it until the day a Republican is sworn in.
The Republican family loyalists take the opposite approach. They put their money under a mattress each time a Democrat is sworn in and put it all into a Dow indexed fund each time a Republican takes office, holding it until a Democrat comes along.
The Republican family would have turned their $100,000 into $509,720 as of Friday. (Curiously, that $509k is actually $2k less than it was in 1929 when Republican Calvin Coolidge gave the keys to the Oval Office to Herbert Hoover; that's a long stretch of no net gain.)
The Democratic family would have turned their $100,000 into $4,273,560, more than 8X the Republican family fortune.
No comments:
Post a Comment