The West Wing
The White House is a symbol of hope, peace and freedom and The West Wing is where the power reigns. It houses the Oval Office, the Cabinet and the Situation Room.
The President of the United States is the leader of the free world, so when he speaks, people listen. In year’s past they’ve used the media like newspapers, TV, and radio to advance their agendas. These messages were filtered, screened, reviewed, and rewritten before they were delivered into the public domain.
Our current President uses the bully pulpit like no other. In addition to traditional forms of communication he’s been using Twitter to advance his policies in real time, unfiltered. His tweets are adding to the increased volatility in the stock market. When he tweets something positive, the market rises. A negative one will drive the market lower. Investors have grown weary of the Trump Twitter Tirades and the on-line sabre rattling with North Korea, Russia and Syria is causing heartache for all.
Since 1921 we’ve had 16 presidents from Calvin Coolidge to Donald Trump and each one has dealt with varying degrees of issues, some more than others. Despite different political parties, world wars, depressions, recessions, assassinations, impeachments, resignations, and tweets the engine of the American economy has chugged along. As our economy has expanded, so too has the stock market. In 1921 the Dow Jones closed at 80 and today it’s 24,360, a gain of 30,350%.
Calvin Coolidge was president during the Roaring Twenties and left office before Black Monday, October 29, 1929. He was a man of few words and was known as Silent Cal. He understood the main driver of our economy was business and that silence was a powerful tool. He once said, “I have never been hurt by what I have not said”
Herbert Hoover had the unfortunate timing of holding office during the worst economic time in our country’s history. The passage of Smoot-Hawley under his watch was a big contributor to extending the Great Depression.
FDR brought us out of the Depression and led the U.S. coalition to victory in WWII. He told us, “The only thing we have to fear is fear itself.”
JFK stared down Khrushchev during the Cuban Missile Crisis in 1962 and was assassinated in office, November 1963. He was the first president to successfully use television to advance his policies and asked: “And so, my fellow Americans, ask not what your country can do for you -- ask what you can do for your country.”
LBJ helped pass the Civil Rights Act and was entangled with the Vietnam War. He, more than most, understood the power of the media and said, “If one morning I walked on top of the water across the Potomac River, the headline that afternoon would read: ‘President Can't Swim.’”
Richard Nixon resigned as the 37th President of the United States before congress could impeach him for his role in Water Gate. He said he wasn’t a crook and added: “When the President does it, that means that it is not illegal.”
Jimmy Carter dealt with the Iran Hostage Crisis, rising oil prices and inflation. The economy and the stock market were stagnant under his presidency and interest rates rose dramatically.
Ronald Reagan brought an end to the Cold War and turned our economy around with his policies. He was not a fan of big government but did spend heavily on our military. He once said, “The most terrifying words in the English language are: I'm from the government and I'm here to help.”
George H.W. Bush led the U.S. and its allies in the Gulf War against Saddam Hussein and Iraq. He served our country in numerous capacities but was known for one of his more infamous quotes on taxes: “Read my lips: no new taxes.”
Bill Clinton passed NAFTA and was impeached. He did, however, believe in America, “There is nothing wrong with America that cannot be cured by what is right with America.”
George W. Bush is connected to the 9/11 terrorist’s attacks and the war in Iraq. On top of the rubble from the World Trade Center he said, “I can hear you, the rest of the world can hear you and the people who knocked these buildings down will hear all of us soon.”
Barrack Obama made history as the first African-American president and told us, “I'm going to try to unite all Americans.”
Presidents will come and go but the stock market will continue to move forward so don’t let the current Twitter tirades get you down. Follow your financial plan, diversify your assets and focus on your long-term financial goals. Remember the words of Silent Cal, “The business of America is business.” The economic machine of the United States will always trump rhetoric.
In all the talk about Democracy, we forget it’s not a democracy. It’s a republic. People don’t make the decisions, they choose the people who make the decisions. ~ Jed Bartlett (West Wing)
Bill Parrott is the President and CEO of Parrott Wealth Management an independent, fee-only, fiduciary financial planning and investment management firm in Austin, TX. For more information please visit www.parrottwealth.com.
Note: Past performance is not a guarantee of future returns. Your returns may differ than those posted in this blog and investments aren’t guaranteed.