Ep 104: Trading Politics: Democrats VS Republicans (Clinton vs. Trump)
★ SUMMARY ★
In this episode, we’re going to be discussing politics. This is not usually the best topic to discuss, and there’s a lot of heat and drama behind it, but our focus today is to talk about trading politics, democrats vs. republicans, and how to look at the market, trading and investing, as well as how the economy looks when a certain party is in office.
There are a lot of factors that are taken into account when people make the decision to choose a president. However, as far as this lesson goes, I’m going to strictly, completely focus on the economic side of things and what the statistical probabilities are for one type of party versus the other. We won’t focus on a specific candidate, but more along the lines of the party.
Democrats vs. Republicans
As far as democrats vs. republicans, the first fact we have is that 9 of the last 10 recessions have occurred under Republican presidents.
Also, statistically, Since World War I, almost twice as many jobs are created per year under Democratic presidents than Republican presidents, about 1.9 million jobs under Democratic presidents vs. 1 million jobs under Republican presidents.
When it comes to GDP growth, Democrats have a better GDP compared to Republicans. When it comes to budget deficit, Republicans tend to spend more than Democrats, and therefore the budget deficit is worse for the Republicans.
When you look at the stock market levels, the stock market has grown 200% faster under Democratic presidents than under Republican presidents. The average yearly growth in the stock market returns under Democratic presidents is 1.92, and under Republican presidents, it is 0.64.
As I said before, I’m just strictly talking about statistical probabilities, I know there are some people that are always going to be in love with a specific candidate. But when it comes to looking at the numbers, as far as economics go, you’re better off economically under a democratic government.
Republican plan vs. Democratic plan
If we take a look at Republicans, they typically have a big business approach that then filters down towards the little people. From this approach, what they do is take tax cuts for the big businesses, and when we get the tax cuts, in general, for a big business, senior executives and management then have more money, and they hire more people and that allows their business to grow.
On the Democrat side, in general, we’re looking at building a skill set, and then this filters up to getting good schooling, which later eventually gets you the job, and then that gets you to a bigger business or growth for a company, you can create your own company or get into the senior management and so on.
With the Democratic approach you’re looking at building a foundation first, and then moving up. On the other hand, the Republican approach starts from the top and it goes down.
The Republican plan, in general, is a quick approach, so they’re looking for quick solutions, but it is not sustainable in the longer term. However, the Democratic plan is more of a slow approach, but it’s more sustainable and it helps in the long run.
Posted at: http://tradersfly.com/2016/09/ep-104-trading-politics-democrats-republicans/
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