record highs on 3 US stock indexes

[Tiny]

ICU and I were answering Vitaman’s question, under the rules he established for this thread:

Originally Posted by VitaMan

The topic remains the same....how will Trump explain record stock markets during the debate.

The answer boils down to this:

Originally Posted by Tiny

Cumulative inflation since Biden took office is about 20%. And the Dow Jones Industrial Average has increased by 28%. Yippee!!!

We can argue all day what caused the inflation - excessive fiscal stimulus engineered by Biden and a Democratic Congress, loose Fed policy, pent up demand after COVID, and/or supply shortages and logistical snafus. (My answer, all four, although the fiscal stimulus early on was most important.) But that’s irrelevant under the rules Vitaman set. The question is how will Trump explain record stock markets, not whether he’s right when he does it.

And as to the price of milk at Walmart and fucking Holstein’s please read my “edit.” Politicians play fast and loose with the facts. Including Biden, although you may not care to admit it.

[texassapper]

"Adjusted for inflation, household net worth was up just 0.7% through Biden’s first three years. It was up 16% through Trump’s first three years." -
@WSJ

[Texas Contrarian]

Originally Posted by adav8s28

...I use to work out with a trader on Wall St in NYC. We would spot each other on Bench press night. He played college football at BYU. He was a registered republican. For any close presidential election he would stay up till midnight of the election to make sure the republican won. He did that with both Bush43 elections. If the democrat won he would make investment changes the very next morning. You say for the most part traders don't care who the president is, but this guy did.

I may not be the right person to chime in on this, since I am an investor, not a trader.

Over a multi-decade period, though, I've had countless people ask how (if at all) they should trade election expectations or outcomes. For many years, my take has been that ensuing market action has often taken perplexing and counterintuitive turns. Second-guessing what those might be is just something I tend to stay away from, as I am a long-term investor.

However, regarding markets, parties, and presidents; I did see what I thought was a very interesting piece by Nick Maggiulli:

https://ofdollarsanddata.com/how-doe...election-year/

(Note to self: I learned that my skinny ass should never challenge adav8s28 to a weightlifting contest, just as I am not foolish enough to challenge golferguy55 to a golf match!)

[Texas Contrarian]

Originally Posted by Lucas McCain

Only in this forum can a thread be started about the stock market reaching its highest peak, and it turns into folks bitching about inflation and the price of fucking milk... damn some of you folks love to whine.

Well, that's because the two are closely interrelated. If a president wishes to take credit for stock market gains during his tenure, while insinuating that they're a result of his policy prescriptions, he must also "take credit" for the consequent inflation that comprises a big portion of the share price appreciation in terms of nominal dollars. Unfortunately for Joe, that's where his problem lies, since there are far more non-affluent voters unhappy about cost-of-living increases than there are investors who are pleased with their market gains.

Originally Posted by VitaMan

Investment appreciation has nothing to do with currency value.

Au contraire!

Market gains expressed in nominal dollars must be adjusted for inflation to reflect an investor's real (inflation-adjusted) returns.

Fortunately, Macrotrends has a handy inflation-adjusted online chart to make it very easy to see the real picture:

https://www.macrotrends.net/2324/sp-...cal-chart-data

One obvious point is that the inflation-adjusted US stock market has just now been catching up to where it was at year-end 2021.

You can also easily see that the market appreciated about 50% (in inflation-adjusted terms) during Donald's term, while the gain under Joe is just short of 20%. Very impressive indeed, Joe! (Especially since we've been racking up deficit spending at a sustained $2+ trillion-dollar annual rate just to maintain the rather modest level of today's growth.)

All Donald needs to do is have his advisors and speechwriters distill this down to a couple of talking points he can fire off in short order, and he'll make the prez look pretty foolish if he wants to boast about how great his economic agenda is.

[Capital]

Originally Posted by Texas Contrarian

All Donald needs to do is have his advisors and speechwriters distill this down to a couple of talking points he can fire off in short order, and he'll make the prez look pretty foolish if he wants to boast about how great his economic agenda is.

I have an idea.. Trump can boast about having "created" the most jobs in a single month, than any President in history!

Oh wait, he did that. In a highly choreographed White House lawn gathering.

Never mind that those jobs were a partial bounce back from the month previous, when more jobs were LOST than in any month in history.

[VitaMan]

Of course there is always currency inflation or deflation to consider to obtain real returns.But it is hardly discussed when reviewing the return on investment. I don't recall ever a fund manager discussing investment performance with inflation adjusted numbers thrown in. Of course it makes the fund managers look better, even after their high fees.



The currency has nothing to do with the appreciation aspect of the gold investment that was presented and asked about.


What these subjects have to do with the Biden Trump debates upcoming and the stock market indexes at record highs is also a stretch.

[Redhot1960]

Originally Posted by VitaMan

Each of the major U.S. stock indexes closed Wednesday at record highs.


If this topic comes up during the Biden Trump debates, wonder what Trump will have
to say.

Chi Comms took a big shit on us... we all gonna pay.
Time to crawl into your hole...

[golferguy55]

Looks like we are having some sell offs in the market today. I will definitely be interested in seeing what kind of impact the election will have on the markets. And TC that was an interesting read as to how the markets have reacted in previous elections.

And on a side note I am always on the hunt for a good $ game on the course.Shot 5 under from the tips which played 7200 yards. Played against one of my old college teammates who is now a club pro in El Paso along with his assistant and the club pro at the course we played. So dust off the clubs TC and get the benji's outlander we can set up a game.

[Texas Contrarian]

Originally Posted by VitaMan

Of course there is always currency inflation or deflation to consider to obtain real returns.But it is hardly discussed when reviewing the return on investment. I don't recall ever a fund manager discussing investment performance with inflation adjusted numbers thrown in. Of course it makes the fund managers look better, even after their high fees.

Experienced, successful investors always judge performance on an inflation-adjusted basis. (Ask any CFA. Or any MBA with a heavily quant background, for that matter.)

Sure, for a 4-decade period leading up to 2022, inflation remained rather quiescent so it entered everyday discussions and media narratives less often, except for the evaluation of comparatively long-term holdings.

But you cut to the heart of the matter and rebutted the claims or insinuations inherent in your second and third sentences with your last one! That is, you're generally not going to hear retail brokers and fund managers telling you what their inflation-adjusted performance is, when the nominal return looks so much better. (That should come as a surprise to no one!)

To an even more key point: You cannot separate any efforts to tout the Biden-era market performance from the elemental factors that drove the recent inflation spike (primarily the spending blowouts of 2021-22). If you want to take credit for the former, you have to accept responsibility for the latter. You own the whole enchilada! (And not just the tastiest portion.)

Originally Posted by golferguy55

Looks like we are having some sell offs in the market today. I will definitely be interested in seeing what kind of impact the election will have on the markets. And TC that was an interesting read as to how the markets have reacted in previous elections.

A lot of us will be musing over this for the next six months.

In a note just out today, Dave Rosenberg reminded that the configuration of Congress is almost as important as who wins the White House, further noting that a split Congress has so often worked out nicely for the economy and the markets.

As history demonstrates so convincingly, stuff tends to go off the rails when one party seizes all the levers of power (especially the debt-accummulation trajectory).

And if things don't look like they're going well according to whatever your partisan preferences may be, just pull up a chair and enjoy the show. This political season is sure to generate a lot of comedic and entertainment value.