the stock market and corporate profits in the obama era

by MaxEntropy_Man Sun Sep 02, 2012 9:22 pm

stock market under obama

2009 Q1 after tax profits: $ 1.01 T
2012 Q2 after tax profits: $ 1.648 T

source for corporate profts: http://ycharts.com/indicators/corporate_profits

by MaxEntropy_Man Sun Sep 02, 2012 9:27 pm

so in my own case, the answer to the famous american poll question, "do i feel better now than i did four years ago", the answer is a resounding YES.

by Hellsangel Mon Sep 03, 2012 4:03 pm

Tenured academic liberals are the least qualified to speak about the middle class in the private sector.

by MaxEntropy_Man Mon Sep 03, 2012 10:36 pm

Hellsangel wrote:Tenured academic liberals are the least qualified to speak about the middle class in the private sector.

are we going to get to anything substantive anytime soon? or is it going to be just rhetorical grenade lobbing all the way to november?

by Hellsangel Mon Sep 03, 2012 10:44 pm

MaxEntropy_Man wrote:
Hellsangel wrote:Tenured academic liberals are the least qualified to speak about the middle class in the private sector.

are we going to get to anything substantive anytime soon? or is it going to be just rhetorical grenade lobbing all the way to november?

It is going to be all about dogs on car roofs until November.

by MaxEntropy_Man Mon Sep 03, 2012 11:12 pm

these are corporate results in the era of a supposedly business unfriendly president. please give me four more years of a business unfriendly environment, so my retirement accounts can continue to do as well as they have the last four years.

by Hellsangel Mon Sep 03, 2012 11:22 pm

MaxEntropy_Man wrote:these are corporate results in the era of a supposedly business unfriendly president. please give me four more years of a business unfriendly environment, so my retirement accounts can continue to do as well as they have the last four years.

How often have you rebalanced your retirement accounts in the past 8 years? And for what reason if you (or your financial adviser) did?

by Guest Tue Sep 04, 2012 2:48 am

doing a quick google, i find that life for tenured professors has not improved in the last 4 years. it's gone downhill with the economic slowdown. (i may be wrong.) i found this particular stats. interesting:

In 1970, 80 per cent of US academics were tenured or on the tenure track. Today, barely half are.

source: http://www.timeshighereducation.co.uk/story.asp?storycode=415013

i suppose US higher education is not insulated from the US economy.

by Merlot Daruwala Tue Sep 04, 2012 5:24 am

On the economy, Obama's biggest achievement is helping prevent what could have been a catastrophic depression that would have left millions more jobless and the financial system in greater shambles than now.

Sadly, any counterfactual narrative is really tough to pull off because we will never know how the alternative outcomes might have panned out. Luckily for him, he doesn't have to strain on that front what with Mittster and co doing a fine job in defeating themselves.

by MaxEntropy_Man Tue Sep 04, 2012 5:31 am

Hellsangel wrote:
MaxEntropy_Man wrote:these are corporate results in the era of a supposedly business unfriendly president. please give me four more years of a business unfriendly environment, so my retirement accounts can continue to do as well as they have the last four years.

How often have you rebalanced your retirement accounts in the past 8 years? And for what reason if you (or your financial adviser) did?

i fail to see how this is of relevance to the claim which i made. want to see how the stock market did when you guys last had the reins?

here you go.

by MaxEntropy_Man Tue Sep 04, 2012 5:52 am

Merlot Daruwala wrote:On the economy, Obama's biggest achievement is helping prevent what could have been a catastrophic depression that would have left millions more jobless and the financial system in greater shambles than now.

Sadly, any counterfactual narrative is really tough to pull off because we will never know how the alternative outcomes might have panned out. Luckily for him, he doesn't have to strain on that front what with Mittster and co doing a fine job in defeating themselves.

yes i know. i don't think it's possible to pin the performance of the economy good or bad on the actions of the president alone, but some folks like doing this during the election season. after all the only control the executive branch of govt (in the US) has on the economy is fiscal policy. even monetary policy is out of their hands and they have no control over it; the federal reserve does. and fiscal policy is but one aspect of economic performance and the performance of the stock market. i'm just playing along.

the republican squawk box likes to paint this president as if he is the next coming of comrade lenin. nothing is farther from the truth. he is probably to the right of dubya when it comes to business friendliness.

by Hellsangel Tue Sep 04, 2012 11:44 am

A lot of people actually lost money in their 401(K)s and other retirement accounts over the last 4 years. The difference was in the way they invested. If you want your retirement account to always faithfully track the S&P500 index, good luck to you

by MaxEntropy_Man Tue Sep 04, 2012 12:19 pm

Hellsangel wrote:A lot of people actually lost money in their 401(K)s and other retirement accounts over the last 4 years. The difference was in the way they invested. If you want your retirement account to always faithfully track the S&P500 index, good luck to you

you are muddying the issue here by conflating two issues.

(i) personal preferences in investing -- things related to asset allocation, sector rotation, picking an indexing strategy etc., and

(ii) the performance of the broader stock market as measured by an appropriate index.

even you will agree with me that the president has NO control over the first, while the government's fiscal policy can have some effect on the second along with several other factors other than fiscal policy. so if you are going to assign credit or blame to the president for the stock market performance, the only fair measure is looking at an appropriate index. fair?

by MaxEntropy_Man Tue Sep 04, 2012 12:32 pm

and the other fundamental thing which drives the stock market is corporate profits, and corporate profits have been boffo in BO's four years.

by Guest Tue Sep 04, 2012 12:43 pm

good thread!

by Hellsangel Tue Sep 04, 2012 2:26 pm

Let us see:

S&500 on Jan 4 2008 - 1411.63

S&P as I post this 1403.56 - Seems pretty flat to me

Unemployment December 2007- 5%. Today - 8.3%

So using data like you say, I think the country is a lot worse today.

by MaxEntropy_Man Tue Sep 04, 2012 2:30 pm

huh? BO moved into the oval office in jan 2009.

i never said he has solved all the economic problems. i am also sure he or any other president cannot solve all the economic woes even if they wanted to. it's not that simple.

by Hellsangel Tue Sep 04, 2012 2:33 pm

MaxEntropy_Man wrote:huh? BO moved into the oval office in jan 2009.

i never said he has solved all the economic problems. i am also sure he or any other president cannot solve all the economic woes even if they wanted to. it's not that simple.

I suppose you forgot a little detail called Lehman Brothers in September 2008.

by MaxEntropy_Man Tue Sep 04, 2012 2:39 pm

i forgot nothing. this is just a reminder to the GOP squawkbox aka faux noise, that if they want to talk about a few aspects of the economy - unemployment and the deficit and pin the blame on the president, then it's only fair that they assign due credit to him for the things that ARE going well.

by Hellsangel Tue Sep 04, 2012 2:44 pm

MaxEntropy_Man wrote:i forgot nothing. this is just a reminder to the GOP squawkbox aka faux noise, that if they want to talk about a few aspects of the economy - unemployment and the deficit and pin the blame on the president, then it's only fair that they assign due credit to him for the things that ARE going well.

That little incident in September 2008 - let us see what it did

Aug 29 2008 - S&P 500 1282.82
Oct 10 2008 - S&P 500 899.22

So if you want to count how the stock market did without counting the fall of Lehman Brothers, you give Barack Obama too much credit.

by MaxEntropy_Man Tue Sep 04, 2012 2:50 pm

he cannot be held responsible for things that happened before his watch. other than what merlot has pointed out, i also give credit to this administration for passing dodd-frank which has done much to return confidence in the financial markets after the wild west era.

by Hellsangel Tue Sep 04, 2012 2:53 pm

MaxEntropy_Man wrote:he cannot be held responsible for things that happened before his watch.

Maybe not. But to give him credit for a normalization in the stock market, you must be drinking the Obama is the messiah koolaid.

by Hellsangel Tue Sep 04, 2012 3:02 pm

PS: You can blame the previous administration forever for all your woes:

by MaxEntropy_Man Tue Sep 04, 2012 3:07 pm

no koolaid being drunk. i have some gripes against this admin for not doing more. i am not totally averse to slower growth in medicare and social security benefits; i think it's inevitable and just wish they'd tell us the truth and settle on some of the difficult compromises so we can all accept it and move on. but coupled with that i would also like to see deeper cuts in defense spending and letting cap gains tax rates go back up to clinton era levels. use the money saved from those three efforts to ease the burden on families with college going kids. a well educated population is a vital ingredient for future economic growth which will go a long way towards erasing deficits. but the dems are scared to talk about it even if they'd like to do it. i wish the president would make a more forceful argument for it.

by Hellsangel Tue Sep 04, 2012 6:02 pm

http://www.bloomberg.com/news/2012-09-04/ism-index-of-u-s-manufacturing-decreased-to-49-6-in-august.html

BTW, looking at how full the parking lot was at the outlet mall on the weekend anyone would be tempted to ask "What recession?"

by Merlot Daruwala Tue Sep 04, 2012 7:28 pm

MaxEntropy_Man wrote:
Hellsangel wrote:
MaxEntropy_Man wrote:these are corporate results in the era of a supposedly business unfriendly president. please give me four more years of a business unfriendly environment, so my retirement accounts can continue to do as well as they have the last four years.

How often have you rebalanced your retirement accounts in the past 8 years? And for what reason if you (or your financial adviser) did?

i fail to see how this is of relevance to the claim which i made. want to see how the stock market did when you guys last had the reins?

here you go.

Oh c'mon prof, this is not a fair argument. Obama's tenure began at the bottom of the market. Gloating abt its recovery from the bottom is fine for a spin-doctor. For real people with 401Ks (or whatever tenured profs have), the fact that the market has taken all of four years to get back to its May 2008 levels is no cause for celebration. Assuming a 10.5% return from equities, taking a leaf out of the much revered CAG in India, the notional loss over these last four years is some 49%.

by artood2 Tue Sep 04, 2012 7:43 pm

Here is the unemployment chart. Based no the Chart, Max posted corporate profits are about half a trillion higher than they were under Bush during the ten year time span. So the quantative easing pushed the money to corporates and did nothing about unemployment!!!

the stock market and corporate profits in the obama era Unemployment-rate-obama-stimulus

the stock market and corporate profits in the obama era Unemployment-rate-obama-stimulus

by MaxEntropy_Man Tue Sep 04, 2012 9:13 pm

merlot: if you're going to take away credit for the stock market performance, you should simultaneously take away the blame for the portion of the deficit caused by the iraq war and the bush era tax cuts. bush was fighting both the wars using off-budget supplementals for crying out loud!

r2d2: i never said unemployment was not a problem. so this is a strawman. however, you can't in the same breath say that BO is anti-business and that all the stimulus money went into corporate coffers without sounding ridiculous.

by Merlot Daruwala Wed Sep 05, 2012 3:58 am

MaxEntropy_Man wrote:merlot: if you're going to take away credit for the stock market performance, you should simultaneously take away the blame for the portion of the deficit caused by the iraq war and the bush era tax cuts. bush was fighting both the wars using off-budget supplementals for crying out loud!

But I never blamed Obama for the deficit at all. The Bush administration was irresponsible in running up the deficit (after starting with a surplus) in those good years. Whatever additional deficit Obama has run up, I would totally condone, given the hole that the economy had found itself in. Without all that government spending, that hole might have been even deeper. But that said, I wouldn't tomtom any stock-market "recovery" when in fact, the market is just about breaking after 4 long years under water.

by MaxEntropy_Man Wed Sep 05, 2012 6:05 am

so you think bailing out banks, infusing the financial system with cash, and passing dodd-frank have nothing to do with the recovery of the stock market at all?

by artood2 Wed Sep 05, 2012 12:56 pm

MaxEntropy_Man wrote:merlot: if you're going to take away credit for the stock market performance, you should simultaneously take away the blame for the portion of the deficit caused by the iraq war and the bush era tax cuts. bush was fighting both the wars using off-budget supplementals for crying out loud!

r2d2: i never said unemployment was not a problem. so this is a strawman. however, you can't in the same breath say that BO is anti-business and that all the stimulus money went into corporate coffers without sounding ridiculous.

It is jsut a question of whether government spending is doing what it is supposed to do. Political rhetoric impresses you. I never said BO is anti-business. OTOH I would like to evaluate the numbers instead of drinking the kool aid.

by MaxEntropy_Man Wed Sep 05, 2012 2:11 pm

artood2 wrote:
MaxEntropy_Man wrote:merlot: if you're going to take away credit for the stock market performance, you should simultaneously take away the blame for the portion of the deficit caused by the iraq war and the bush era tax cuts. bush was fighting both the wars using off-budget supplementals for crying out loud!

r2d2: i never said unemployment was not a problem. so this is a strawman. however, you can't in the same breath say that BO is anti-business and that all the stimulus money went into corporate coffers without sounding ridiculous.

It is jsut a question of whether government spending is doing what it is supposed to do. Political rhetoric impresses you. I never said BO is anti-business. OTOH I would like to evaluate the numbers instead of drinking the kool aid.

this thread was about business friendliness and i posted some relevant numbers. how do you measure business friendliness other than by using corporate results? and how is this drinking koolaid? this thread was NOT about unemployment. what it shows is that in an era of high employment, corporations are still doing very well. based on how they've done there is no way you can conclude that this administration is not friendly to business.

by Merlot Daruwala Wed Sep 05, 2012 2:29 pm

MaxEntropy_Man wrote:so you think bailing out banks, infusing the financial system with cash, and passing dodd-frank have nothing to do with the recovery of the stock market at all?

I don't have an opinion on that. But my point is that there is no joy to be had from your so-called "recovery" given that it has taken four long years simply to get back to where it was. Much as one might console oneself thinking that it could have been far worse and the markets could have stayed underwater for a couple of decades (like it did after the crash of 1929), the fact remains that there even tenured professors retirement accounts have experienced staggering notional losses (making all that exuberance over its health somewhat irrational). And mind you, tenured profs are not the middle class. If you look at the actual middle class (i.e. annual income of $55K and thereabouts), their wealth has shrunk, career options dwindled and income stagnated. Nope, they are certainly not better off. But yes, they could be worse off with the other bunch of jokers.

by MaxEntropy_Man Wed Sep 05, 2012 2:34 pm

Merlot Daruwala wrote: If you look at the actual middle class (i.e. annual income of $55K and thereabouts), their wealth has shrunk, career options dwindled and income stagnated. Nope, they are certainly not better off. But yes, they could be worse off with the other bunch of jokers.

agreed and that was my limited point really, however inartfully i may have made it. elections are about relative choices and IMO the other choice this time around is much much much worse.

and no, i am not celebrating this recovery, but the central question was not about recovery and not about how individuals fared, although that did feature in the discussion. the central question that i wanted to pursue was to refute this notion about BO's unfriendliness to businesses. that's a crock of hooey.

by Hellsangel Thu Sep 06, 2012 11:12 am

Oh and let us not fail to give credit to Bill Clinton for the jump in the indices today.

by MaxEntropy_Man Thu Sep 06, 2012 11:16 am

Hellsangel wrote:Oh and let us not fail to give credit to Bill Clinton for the jump in the indices today.

did clinton change his name to draghi?

by MaxEntropy_Man Thu Sep 06, 2012 11:23 am

take it for what it's worth:

http://money.cnn.com/interactive/news/economy/are-you-better-off/?iid=EL

faux noise might come up with exactly opposite polling results.

by Hellsangel Thu Sep 06, 2012 11:32 am

MaxEntropy_Man wrote:
Hellsangel wrote:Oh and let us not fail to give credit to Bill Clinton for the jump in the indices today.

did clinton change his name to draghi?

No. But the great man spoke about the next 4 years and the stock markets heard his rallying cry.

by Hellsangel Thu Sep 13, 2012 4:20 pm

http://politicalticker.blogs.cnn.com/2012/09/13/cnn-poll-are-you-better-off-than-four-years-ago/

by MaxEntropy_Man Thu Sep 13, 2012 6:02 pm

Hellsangel wrote:http://politicalticker.blogs.cnn.com/2012/09/13/cnn-poll-are-you-better-off-than-four-years-ago/

there is an interactive feature there. put your entries in there and it allows you to see what others have said. do it and look at the results and be surprised. my original link came from this article.

by Hellsangel Thu Sep 13, 2012 7:02 pm

MaxEntropy_Man wrote:
Hellsangel wrote:http://politicalticker.blogs.cnn.com/2012/09/13/cnn-poll-are-you-better-off-than-four-years-ago/

there is an interactive feature there. put your entries in there and it allows you to see what others have said. do it and look at the results and be surprised. my original link came from this article.

Does not seem to match this:

According to a CNN/ORC International poll (PDF) released Thursday, 37% of registered voters say compared to four years ago, their financial situation is now better, with 44% saying they're now financially worse off, and nearly one in five saying that their situation is the same. Among crucial independent voters, one in three say they're better off, with nearly half saying they're worse off and 17% saying they're in the same financial situation.

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