Presidential Impacts, Market Strength

Last week I visited Washington DC to see a client. In a show of the freedom and privileges we have here in the US, I had the opportunity to go into our nation’s capitol and pay respects to former President Jimmy Carter as he laid in state prior to his funeral.

The wait was over 2 hours long in freezing temperatures but an experience I will never forget. I stood in line and made friends with 3 fellow citizens, and we talked about the freedoms we have in the United States of America. Given our varied ages and backgrounds, we talked about how things have changed in the past 45 years and our hopes for the years to come. Collectively, there was a combined respect and regard for the President whom we were about to see.

As we find ourselves a few days away from the next presidential inauguration, I cannot help but remember the questions from this past year about what the market may do in response to the election.

Throughout 2024, we talked extensively about how the market is made up of individual companies whose focus is to excel in their business ventures and make money for the shareholders. These companies are innovative and nimble when new legislation is enacted, or executive orders are signed. While there may be some volatility in and around election cycles and/or new laws, history shows us that the markets trend upward and provide positive returns for investors willing to stay the course.

Standing in line last week, I could not have told you how the markets performed during President Carter’s single term, but I can tell you his four years were not without challenges that may have scared investors away.

In the end, how many of us can remember how the markets performed during each presidential term? We might have vague recollections, but chances are we do not remember the specifics of the 4-8 years for which each president either received credit or took blame.

Investors would have missed the incredible market run of the 1980’s if they stepped away from the markets during any one of the challenging events during the Carter presidency.

We should understand that, over time, markets trend upward which is the entire reason we invest: with hope of future positive returns. We should remember the president does not the market make.

As the US and the world remembers President Carter, we do not reflect solely on how the markets performed or how the economy changed under his watch.

We remember the man President Carter was during his time in office, as well as, the life of service he led after leaving the office of president.

Amanda Howerton, CFP® , CDFA® is a Senior Advisor with Rather & Kittrell.