It’s a stark turnaround for the Biden stock market. The S&P 500 was up nearly 24% from Inauguration Day through the end of last year.
Many experts are quick to point out that the stock market is not the overall economy. What happens on Wall Street doesn’t always directly impact people on Main Street, especially those who aren’t active investors.
However, consumer confidence and sentiment measures often mirror the ups and downs of the markets. Even if people aren’t investing in stocks, they read about the chaos on Wall Street on their smartphones and see coverage of it on television.
Many Americans also have exposure to the market through company 401(k) plans and other retirement accounts.
All of this could pose problems for Biden and Democrats in the upcoming midterm elections.
But if there is any consolation for Biden, the market implosion during the early stages of his presidency is not as bad as those experienced by some of his predecessors, according to data from CFRA Research chief investment strategist Sam Stovall.
The market plunged 16.5% in the first 510 days of Ronald Reagan’s presidency, which was also a period of historically high inflation. Stocks were down 25% in the early part of George W. Bush’s presidency, as the market was in the midst of the dot-com meltdown and struggled to recover in the aftermath of 9/11. But both Reagan and George W. Bush wound up being re-elected.
Meanwhile, stocks soared more than 20% early in both George H.W. Bush’s and Donald Trump’s tenures in the Oval Office. Neither was elected to a second term.
Still, the stock market fell about 3.4% at the onset of Jimmy Carter’s presidency, just slightly more that the current Biden drop. Carter also had to cope with high inflation and geopolitical concerns, with the Iran hostage crisis occurring late in the third year of his first — and only — term in office.