Bloomberg’s back on the “Obama’s Bull Market” stuff.
It’s got the usual soothsayers claiming to know what “the market,” that magical superorganism comprised of trillions of independent decisions backed by unknowable reasons every day, wants:
“The market has been uncomfortable with the pace of the legislative agenda this year,” said John Canally, a Boston- based investment strategist and economist at LPL Financial, which oversees $285 billion. “Republican control of the House could usher in some gridlock and slow the pace. The view of the market is that Washington is pushing a little too far.”
Or you could get somebody to say, “The market has been uncomfortable with the slow pace of government spending this year and is worried about the resulting slower growth.” Actually, Bloomberg does that:
Spending cuts to trim record budget deficits may now curb further gains in stocks, according to Jason Pride, director of investment strategy at Glenmede.
It’s certainly true that you can use the big run-up in stock markets under Obama as evidence that they don’t believe he’s a commie socialist intent on seizing the means of production, and it’s a bit more reasonable to peg a market trajectory to a president after eighteen months than after six weeks. But it’s still impossible to know whether his policies are responsible for the market going up a bunch or if they’re responsible for them not going up as much as they would have under someone else.
And this is silly:
The Standard & Poor’s 500 Index has surged 48 percent on average starting in the second year of each U.S. presidential term, measured from its lowest level through the high the next year, according to data going back to 1928 compiled by Bloomberg. That compares with trough-to-peak gains of 38 percent in other years.
Huh? Why would you you measure it that way?
So good for Mr. Pride for not playing along with the reporters:
“I don’t think you should make an entire investment decision on the presidential cycle.”Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at firstname.lastname@example.org. Follow him on Twitter at @ryanchittum.