A story done by Dirk van Dijk, CFA for Zack’s Investment Research, compared Ronald Reagan’s first year in office with Barack Obama’s. Both presidents inherited a sick economy: Obama a meltdown of the financial system and Reagan runaway inflation. Of course, the situations were different, but both were significant financial threats to the economy.
- When it came to improving employment and real disposable income, Reagan did the better job.
- In terms of promoting a strong dollar and shrinking the trade deficit, it’s a tie.
- When they consider inflation, industrial production, interest rates, yield curve, mortgage rates, home sales, and stock market the nod goes to Obama for having the better record.
Overall, Dijk says the advantage goes to Obama as the president that is doing a better job. Let me add that Zack’s is not known for being overly liberal.
Writes Dijik, “The U.S. economy is more of an oil tanker than a speedboat, and does not turn around on a dime, so it really is too early to tell how Obama is doing. However, the indicators that are most forward-looking and leading for the economy (stock market, yield curve and quality spreads, housing starts) are the ones that favor Obama over Reagan. Overall, 11 months in, one must conclude that Obama is doing at least as good a job on the economy as Reagan did in his first 11 months.”
You can read the whole story here.