So, for every success there is a failure, and for every President who had the Gods of economics shine down upon him, there was another who got a pretty raw deal. In our first article, we looked over the five Presidents who saw the best returns for the Dow Jones Industrial Average (which we used despite my tremendous misgivings with that particular index) during their time in office.
Frequently, it just demonstrated why gauging the quality of a presidency by the success of the stock market under their watch isn’t all that useful. Likewise, a lot of the Presidents on this list of the bottom five shows something similar. Sometimes, you simply take office at the wrong time, coming off a long bull market that essentially guarantees the markets aren’t going to be pretty for you.
That said, some of these guys may actually deserve to be remembered as pretty lousy leaders when it comes to the economy. So, here are the five Presidents with the worst returns for the DJIA during their administrations.
Tenure: March 1929 to March 1933
Total DJIA Returns: -81.969%
Annualized with Dividends: -31.655%
Annnnnd HERE is the other half of Calvin Coolidge’s 30% percent annualized returns during his tenure. Hoover basically took office and got a little over six months of good times before the rickety house of cards that Coolidge and company built came crashing down. You see, most of the market maneuvers that are now illegal? The pump and dumps and scams? The 1920s were the period during which people figured that they needed to be illegal. Of course, Hoover’s not blameless in this. He made a big mistake by failing to bail out the banks, and his refusal to engage in deficit spending is now typically viewed as an obstinate decision that only deepened the depression.
George W. Bush
Tenure: January 2001 to January 2009
Total DJIA Returns: -22.083%
Annualized with Dividends: -0.817%
Granted, Dubya clearly had a lot of other stuff on his mind, and the housing market crash caught a whole, whole lot of people by surprise. Nonetheless, Bush II inherited a surplus and a booming economy and wound up with things sliding into the worst recession since, well, the guy sitting at number one. Had the Bush administration made regulating the financial industry a real priority at any point in his first six years in office, maybe things might not have played out quite the way it did. Not to mention, the massive deficit run up by two wars and a massive tax cut didn’t help.
Richard M. Nixon
Tenure: January 1969 to July 1974
Total DJIA Returns: -15.923%
Annualized with Dividends: 0.582%
In fairness to Nixon, the Watergate Scandal was a major factor in driving down markets immediately prior to his resignation, making these numbers look a lot worse than they would have without. Of course, that may be stretching the use of “in fairness,” as the Watergate Scandal is one of those things that you can really pin on just the one person. And that’s Tricky Dick.
Tenure: March 1913 to March 1921
Total DJIA Returns: -5.599%
Annualized with Dividends: 5.955%
Woodrow Wilson frequently gets a lot of credit from history books for his role in the Treaty of Versailles and his ambitious attempt to create the League of Nations. Unfortunately, in reality, there’s also a lot to dislike about Wilson’s Presidency, beginning with his being a virulent racist who helped segregate large portions of the federal government and ending with him having a series of debilitating strokes in September of 1919. All told, the market moved in fits and starts while he was in office, with World War I creating a lot of growth but the years before and after pulling back.
William Howard Taft
Tenure: March 1909 to March 1913
Total DJIA Returns: -1.736%
Annualized with Dividends: 6.372%
See, Howard? You ARE known for something other than getting stuck in the bathtub! Actually, it’s a shame that Taft has been tossed onto the scrapheap of history after falling between Wilson, who’s remembered for World War I, and Teddy Roosevelt, who’s remembered for, well, being Teddy Roosevelt. The reality is that Taft continued Roosevelt’s trust-busting ways and arguably managed even more progress there than Roosevelt. That said, Taft did appear to fall into the same market valley between the boom times of the Gilded Age and the 1920s as Wilson did.
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