With George W. Bush As Prez, Dow Drops Most Points Ever
Tuesday, January 20, 2009 4:26 AM
istockanalyst.com
(Source: Boston Herald)trackingBy Jerry Kronenberg, Boston Herald
Jan. 20--Call it "Mission Unaccomplished."
George W. Bush leaves office today with the Dow Jones industrial average off 2,306 points from when he took over: The worst performance for any U.S. president.
The blue chips closed Friday -- the last full trading day of Bush's term -- at 8,281, way off of the 10,588 that the index stood at when Dubya took office in 2001.
That makes Bush the first president since Richard Nixon to preside over a declining Dow. In percentage terms, Bush's 21.8 percent Dow drop is the worst showing since an 83.2 percent decline under President Herbert Hoover, whose term included the 1929 stock-market crash.
"I wouldn't hold Bush completely responsible, but he didn't do anything to help the situation -- and did a lot of things to exacerbate it," said Jeffrey Hirsch of the Stock Trader's Almanac.
Hirsch and other experts partly blame the red ink on circumstances beyond Bush's control, such as the downturn that followed the 1990s dot-com bubble.
But market watchers also lay plenty of blame on the outgoing president.
"A lot of (the losses) stem from Bush's unwillingness to make hard decisions," said Herald columnist and WBIX-AM (1060) "Money Matters" host Barry Armstrong.
For instance, Armstrong said, Bush's 2001 tax-cut package spawned huge budget deficits that have hurt the government's ability to address today's recession.
But the financial planner fears the tough times will continue well into President Obama's term.
"I think 2009 and 2010 are going to be bad years for the market," Armstrong predicted, estimating that the Dow will stay stuck in a 7,500-to-9,500 range.
By contrast, Hirsch expects the blue chips to rally 40 percent by June.
After all, the Dow soared 75.4 percent during President Franklin Roosevelt's first 100 days in office, and rose 38.5 percent shortly after Gerald Ford took over in 1974.
Hirsch also noted that since 1953, the Dow has historically added 9.7 percent in the first year after a Democrat such as Obama assumes the presidency.
"Obama is coming in at a time when most of the air has already been taken out of the market," Hirsch said. "It's pretty obvious to everyone what he has to do: Stimulate the economy and get people back to work."
jkronenberg@bostonherald.com |
