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Does It Matter If You Vote Today?

03/06/2012

Since today is the Republican primary and since I sit here with an “I Voted” sticker on my shirt,  it might be well to see which party has produced better results for Wall Street, which is predominantly Republican.

If you invested $1,000 in the S&P 500 when Kennedy took office and kept it invested only during Democratic administrations, you would have $10,920 today.

On the other hand, if you invested the same amount when Nixon took office and kept it invested only during Republican administrations, you would have a mere $2,087 today.

ADVANTAGE:  Democrats

The annualized returns during the 23 years Democratic administrations was 11% compared to only 2.7% during the 28 years of Republican administrations.

ADVANTAGE:  Democrats

However, if you remove the Democrat with the best investment record (Clinton) AND the Republican with the worst investment record (Bush II), the Democrats still win with $3,539 compared to $3,296 for Republicans, a much closer comparison . . . but still . . .

ADVANTAGE:  Democrats

Of course, facts are not nearly as important as “spin” anymore.  So, the Republican spin is that every Republican President since World War II has faced a recession in his first term, inherited from previous Democratic administrations.  (Nine of the last eleven recessions have started during Republican administrations.)

The Democratic spin is that this is proof that the Keynesian-stimulus approach works to the benefit of the economy and Wall Street.

My thought is that the Democrats are right to apply Keynesian-stimulus during recessions but derelict in not reducing the debt during good years (except for Clinton).  Additionally, Republicans are right that tax cuts will strengthen the economy, but not as much as the current level of debt weakens the economy.  

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