I was doing some thinking on the new American President and the current president. In particular I wanted to know how the market did for some presidents. So I looked back at the DOW and looked at the dates when each president was in office. I came up with the following table.
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This was an interesting table because only three times has a president entered and left office with a lower market. And in each of those three times it was a Republican! Ok maybe a miracle will happen and the DOW will top 10587 before January 20. You never know.
Though I find it interesting that it is Republicans who could be construed as Screw ups… Ok there was a close call for Jimmy Carter, but then again people do consider him a screw up as well. Though probably not as bad as Nixon.
That lead me to my next question, is the performance of the market related to the president? I think so because if you look at Reagan, and Clinton, both are loved and both had amazing stock market returns.
Getting back to Bush Junior. Barring a miracle where the stock market returns to 14,000 I think history will consider George Bush Junior a screw-up.
This then asks the question is it worth it to do long term investing? After all many Fast Money crew folks are saying 2008 is the year that value investing died. Hmmm, not so quick. In the book Valuation I stumbled onto the following graphic.
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The graph represents the return on three assets: Stocks, Gold, and Bonds. So if you invested 1 dollar in the stock market in 1800 it would be worth a whopping 100 million. If you invested 1 dollar in fixed income it would be worth around 50,000. And finally if you invested 1 dollar in gold it would be worth 75 dollars.
I cracked up laughing with the gold rate of return, because in 200 years I made 75 bucks! I think that is like 0.0000000x percent return per year! Yes invest in Gold because Gold is better than Fiat money or what have you.
I think this graph was nice because since 1800 we have had many many wars, depressions, recessions, bubble and what have you. And after all was done and said you should be investing in stocks.
So there Macke and you Fast Money idiots! Just because you can’t make money with investing and getting your shirts ripped off of you it does not mean value investing is dead and that Buffett has gone senile!