The stock market is at an all-time high. This is great for the 55% of Americans who actually own stocks.  Of course this rise doesn’t mean much for the other 45%.

So who gets credit for the stock market surge?

Let’s look at some recent history. In 2017 when the new President was elected he entered the White House with a solid economy behind him.  The economy was growing. Not by a great deal but it was growing back from the disaster of the economic crash of 2008.  Back then  economists were in agreement on one point — it would take 10 years for the economy to get back to the pre-recession point. Keep that in mind.  That meant 2018 was going to mean the time when the economy would get back in shape. Until then it would mean a decade of struggles and economic fits and strains.

Jump forward to 2018 and the economy was growing slowly but it was still continuing to grow.

That year a major tax cut was introduced. The corporate tax cut gave companies more money which they were supposed to reinvest but many chose the added cash to buy back stock and increase their bottom line to make their stock more valuable. 

Was it legal?  Yes.

Was it contrary to what the tax cut was intended to achieve? Yes.

Did the national deficit take off and explode? Definitely yes. We’ll be paying this debt back for a long time to come. Some in economic and government circles claim that debt doesn’t matter.  Tell that to the person who has to pay back student loans, businesses who are saddles with start-up loans, consumers who are wangling credit card balances and homeowners who face monthly mortgages.

The increased stock market was supposed to mean we would grow our way out of debt. Is it happening?  Not so far.  Will it happen? Let’s hope.

So the stock market is up. The debt we citizens are carrying (shlepping to be more accurate) gets bigger every single day. That debt will have to be paid off eventually or the whole USA will need to declare bankruptcy.  Imagine that.

After all is said and done, would all of this have happened if someone else won the 2016 Presidential election? Remember that economists said it would take a decade to get the economy back into shape regardless of who was sitting in the Oval Office.

So can the current resident at 1600 Pennsylvania Avenue take any credit or take any blame for the current economy?

Consider this — when the market was moving from recovery to robust did it happen because of Presidential tweets, crowing and posturing? If it did then does that mean the success of the stock market depends on Presidential popularity?

Following that logic the market should then decline with Presidential unpopularity.

So what do we make of the fact that since the President is now impeached, at a low point in opinion polls and more than half the country wants him out of office, shouldn’t the market be crashing and tanking?

Instead the market is still growing and as 2019 closes it’s at even higher levels and the economy is benefiting from the ten-year recovery that economists said would happen.

Bottom line….does the President make any difference in the market’s health? When business decisions are made by CEOs, CFOs, and entrepreneurs do they honestly and truly think of who is currently President, or whether or not they personally like the Presidential persona, before they develop budgets; plan strategies; put the economic wheels in motion?

Or are business decisions made on business principles regardless of who is delivering speeches, tweeting, boasting, hectoring or complaining? What do you think?  History doesn’t think so.