The performance of U.S. stocks under President Joe Biden has not been as strong compared to previous administrations. The research team at Wilshire Indexes has highlighted this trend by analyzing the FT Wilshire 5000 XX:W5000FLT, an index that reflects the overall performance of the U.S. stock market.
Concerns and Future Outlook
There is growing concern among Biden and his allies regarding the performance of stocks, specifically when comparing it to the first terms of Donald Trump and both terms of Barack Obama. Philip Lawlor, the managing director of market research at Wilshire Indexes, suggests that the administration may take action in 2024 to address this issue.
"In light of the upcoming 2024 election, the noticeable discrepancy in cumulative equity returns between the Biden administration and the superior performance seen during the Trump and Obama presidencies is a cause for concern," Lawlor explained. "Considering the logic of the electoral cycle, the Biden administration will likely make efforts to close this gap."
Re-election Campaign and Economic Policies
As part of his re-election campaign, Biden officially launched his campaign in April. In recent months, both the Democratic incumbent and his cabinet officials have been actively promoting their economic policies across various locations in the U.S. One such policy is the Inflation Reduction Act.
Addressing Market Struggles
Earlier this year, when questioned about the stock market's difficulties, a White House official acknowledged the importance of strong stock performance. However, they also emphasized that approximately half of Americans do not have investments in stocks. The official highlighted other economic indicators as well.
Overall, with concerns regarding stock market performance under President Biden, it remains to be seen how his administration will take steps to address this issue and ensure a more favorable trajectory in the coming years.
The State of the Economy and the Middle-Class
In assessing the state of the economy, President Biden's main focus is on the well-being of middle-class families. According to Bharat Ramamurti, deputy director of the White House's National Economic Council, the president examines factors such as the availability of good-paying jobs that support families, wage increases, and opportunities for career advancement and higher incomes. These measures indicate that the economy is performing exceptionally well.
Republican presidential candidates recently addressed their economic proposals during a debate held in Milwaukee. Governor Ron DeSantis of Florida, currently second in GOP primary polls, emphasized the need to reverse "Bidenomics" in order to provide middle-class families with opportunities for success. Meanwhile, former President Trump, the frontrunner in the 2024 primary, did not participate in the debate but instead released an interview ahead of the event.
According to betting markets tracked by RealClearPolitics, President Biden has a 35% chance of winning the 2024 presidential election, with Trump at 27% and DeSantis at 6%.
In choppy trading on Friday, stock markets, including the DJIA and COMP, experienced gains after Federal Reserve Chair Jerome Powell warned about the possibility of raising interest rates further. Powell noted the need to temper a robust U.S. economy and control inflation while reassuring investors that the Fed would adopt a cautious approach.
From ’s archives (Dec. 31, 2022): U.S. stocks endured their most challenging year since 2008 due to the impact of the Federal Reserve's rate hikes.
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