Although President George H.W. Bush,
proclaimed Reaganomics as voodoo economics when campaigning ahead of the
1980-elections, he benefited from the related supply side economics.
Three of the four years of his presidency yielded bullish conclusions.
The past two-hundred years or so offer ample
evidence of the lying nature of politicians. While most are sneaky and
very competent in the art of lying, George H.W. Bush was not. Despite
that, he is guilty of it. His campaign promise in 1988 was "no new taxes."
He said that loudly and clearly. Everyone heard it. Once elected, he
proceeded to raise taxes. Most of us "in the know" were not surprised. He
and his son, George W. Bush were very fiscally liberal.
The DJIA Index moved incongruently to
historical standards in the post election year of 1989, which
uncharacteristically demonstrated bullish expressions. However, the
balance of this presidential election cycle was congruent to historical
standards with the market finding its customary cyclical bottom in the mid-term election year and
providing for bullish expressions in the pre-election year and election
The market did a poor job anticipating the
1990 recession, but again made up for its tardiness with a steep and quick
drop. The recession was short, but fairly steep. Lingering
unemployment and corporate downsizing pushed George H. W. Bush out of the
Whitehouse from record high popularity ratings only a few months earlier.
Americans vote their pocket books on election
day. If empty, the incumbent is fired. The only exception to that is the
incumbent's propensity for re-election during wartime.
The collapse of communism, green
mailing, and a rise in capitalistic Darwinian influences paved the path to
unprecedented bull market cycles. Keep in mind, no trading model can
outperform buy and hold during strong and long-lasting bull markets. Again,
bears eventually come along and apply destructive results to those that buy and