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Biden’s Stock Market Mirage

Posted on Wednesday, April 3, 2024
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by Andrew Shirley
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44 Comments
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AMAC EXCLUSIVE

New York Stock Exchange. Stock price before stock market in New York

With the dismal failure of the White House’s “Bidenomics” pitch now evident, Biden’s economic message to voters for his re-election effort now relies heavily on what at first appear to be strong returns in the stock market. But even this argument is undermined by Biden’s other economic failures.

Despite inflation remaining more than 50 percent higher than the Fed’s target rate of two percent and the fact that just 26 percent of Americans rate the economy as “good” or “excellent” according to the latest New York Times and Siena College poll, the one economic bright spot the Biden administration has been able to point to in recent months has been the stock market. The Dow Jones Industrial Average and S&P 500 both ended the first quarter of 2024 on record highs, with the S&P notching its best start to the year since 2019.

The corporate media has been quick to capitalize on this headline as evidence of the supposed success of Biden’s economic policies. “The Biden stock market is swamping Trump’s,” declared Yahoo News. Ed Finn, a former editor at Barron’s, wrote that Biden has “brought happy days for investors” in an opinion piece for The Wall Street Journal.

Biden himself has also sought to claim credit for the strong stock market. “Good news for folks as we start the weekend,” Biden posted on X in February in response to an NBC News post about the stock market. “The stock market going strong is a sign of confidence in America’s economy.” (As a number of conservative accounts on X were quick to note, back in 2020, Biden criticized Trump for supposedly saying that “the economy is doing well if the Dow Jones is doing well.”)

Yet Biden’s celebration of strong stock market returns is highly misleading. For one thing, it makes no acknowledgment of the fact that the prices of stocks are up at a time of historic overall inflation. Overall, cumulative inflation since Biden took office is over 18 percent – meaning that 18 percent of the gains seen in the stock market under Biden have been completely erased by inflation.

Once inflation is taken into account, the rate of return for the S&P 500 over Biden’s first three years in office (otherwise known as the “real return”) is just 8 percent – well below the S&P’s historic three-year average of 20 percent.

As a general principle, higher inflation also makes stocks more attractive than bonds, meaning investors place more money in the stock market than they do into other securities. High internet rates have cratered the bond market, meaning much of the stock market growth is merely funds disproportionately removed from bonds.

In other words, the recent strong stock market returns aren’t a sign of “confidence” in the economy, as Biden claims. They’re more likely a sign of investors trying to offset the economic impacts of the persistent inflation brought on by Biden’s record spending.

Moreover, as Heritage Foundation senior fellow Stephen Moore explained in a February opinion piece for Fox News, “Most of the gains in the market have only made up for the miserable returns in Biden’s disastrous first two years in office when stocks lost almost 15 percent of their value.”

“In other words,” Moore continues, “for the most part, the last 14 months have simply made up for the lost ground during the 2022 rout in stocks.”

It’s also worth noting that most of the gains in the stock market have been driven by just seven companies – Apple, Alphabet, Microsoft, Amazon, Meta, Tesla, and Nvidia. Combined, these firms make up nearly one-third of the S&P’s market cap. The success of these companies on its own is not enough to claim that the entire economy, or even the entire stock market, is doing well.

Conversely, when President Trump was in office, the Dow saw 126 all-time highs while reflation remained under control. As a result, Trump oversaw both a historically strong stock market and increases in real wages and the purchasing power of American households.

Polling data suggests that, no matter how hard Democrats and the media try to convince people that Biden’s presidency has been good for their wallets, most Americans aren’t buying it. According to a CBS News survey released in March, 65 percent of voters rate the economy as “good” under Trump, compared to just 38 percent who say the same under Biden. Another CNBC survey from March found that a plurality of 39 percent of respondents said they would be better off financially if Trump were re-elected this November, while just 23 percent say they’d be better off if Biden gets another term.

While Biden will almost surely continue to tout robust stock market numbers leading up to Election Day, the reasons why most Americans won’t be convinced by that argument are easy to see.

Andrew Shirley is a veteran speechwriter and AMAC Newsline columnist. His commentary can be found on X at @AA_Shirley.

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Stephen
Stephen
3 months ago

I can personally vouch for the fact that Biden’s first two years in office caused a loss of 15% in my investment portfolio. The recent run-up in the Dow/S&P/Nasdaq has not brought my investments even back to where they were in 2020. This canard is the same as his phony claim of “reducing the deficit,” while the national debt went up by $8,000,000,000.00, or his claim that unemployment is “down,” which is fraudulent when one examines the particulars. Almost all of the “new” jobs are actually replacing those lost as a result of government mandated shutdowns in 2021 and are either in government or health care instead of the private sector, and most of that went to foreign-born workers. I hate Biden and all he stands for. I feel the same animus towards everyone who stupidly, blindly supports him.

Nick
Nick
3 months ago

First of all the New York Times is nothing but a left-wing mouthpiece. They denied that the Holocaust even happened. Whatever they print you know is wrong and there’s nothing but Marxist liberal lies. They are an organized group of pathological Liars nothing to see here move along

Nobody’s Business
Nobody’s Business
3 months ago

Another reason that no one seems to talk about is when you are afraid of spending and borrowing money to expand YOUR business because of economy and taxes, you take what money you have and try to invest in stock market instead of your business, thus making the stock market go up without the actual business you are investing in making money. Only showing gains through people investing. It’s a false indicator what the business is actually doing.

John Lemley
John Lemley
3 months ago

Sadly “Most Americans” will not see this explanation and will continue believing the deception spewed out by the Biden administration and liberal media. Tragically, those deceived masses will vote in November.

Rik
Rik
3 months ago

Bidenomics, that’s where I spend $2 for 2 sandwich rolls when I used to spend 3 for $1 before he stole the Presidentcy!

Westhus092
Westhus092
3 months ago

Note to the Communists and any undecided voters: WALL STREET IS NOT MAIN STREET!!

Ann
Ann
3 months ago

I lost so much under Biden that hasn’t come back yet to 2020 levels in my portfolio, even though the markets are at highs. It kind of makes me sick to think how much more I would have made if Trump were in office. And the inflation rate has caused prices to increase so much — they will never go back down to pre-2020 levels, so our money doesn’t go nearly as far as it used to. They just make the most stupid decisions — I guess that’s what you get when you reward people with no abilities with high-level government and cabinet jobs just because they are your friends and/or supporters. I truly believe the economy keeps chugging away IN SPITE OF all the destructive things this administration has done.

Steven
Steven
3 months ago

With the majority of working class people living paycheck to paycheck under Biden’s economic policies it’s no wonder that 74% of those people do not believe that the economy is doing well. And for most Americans their credit card accounts have ballooned. Despite the recent run up of the stock market my IRA portfolio has not made up for the losses since Biden took office. This shouldn’t be surprising when you consider the damage he has done to the auto industry with his fantasy EV vision for the future. When 5,000 auto dealers send a letter to the President telling how that they cannot sell EVs and when Ford & GM have lost billions of dollars trying to build EVs, there is a problem in the Biden Administration when it comes to dealing with reality. There is not one success Biden can claim in his 3+ years as President. Our economy is weak, his open border policy is an unmitigated disaster, our foreign policy is a failure, our school systems need to be overhauled and on it goes. He has done nothing that has benefitted the American people. Maybe that’s why he has to import illegal aliens in the hope that they will support him. His own country men & women don’t.

Robert Zuccaro
Robert Zuccaro
3 months ago

Stop whispering like an idiot, Joe, because “it’s NOT working”! And that supposed “2% inflation” you keep bragging on is ADDITIVE to three years of 2-8%… went to Subway yesterday: a 6 inch #20 cost what my footlong Pastrami was three years ago or $8.99. My #3 was almost $15! That’s called INFLATION, Joe, caused by all the spending, dollar devaluation, and gas prices. So happy your wealthy donors are banking it on the stock market… but ppl like me, retired on a fixed income, we’re squeezing pennies.

BOB
BOB
3 months ago

With 18%. Cumulative inflation, considerable loss in the market, who in their right mind could vote for this again? I’m still trying to recoup from these four years of the moron in chief.

Melinda
Melinda
3 months ago

The stock market has always gone up and down, sometimes more than we’d like. I’m not sure the administrations policies have a lot to do with it, except in the realm of confidence by investors. But the article makes sense in that inflation has much to do with the rise in numbers. Biden knows nothing about business, except maybe the funny kind.

Stephen Russell
Stephen Russell
3 months ago

Rather invest in Mutual Funds thus can acess more stocks in one vs individual stock buys

Max
Max
3 months ago

Hopefully, the American people will not be taken in by the words, articles, podcasts and MSM that continue to spout all out lies of this administration and the Left handlers.
Sidenote: learn more about this upcoming eclipse and its relationship to the 2017 and 2023 eclipses at eclipsewitness.com/american-eclipse-judgment. Very interesting info and other websites.

Thinking
Thinking
3 months ago

The stock market might be higher if you have stocks in those companies mentioned in this article. If you don’t the stock market is not that good. It was better under Trump. I have not recovered what I lost under ole Joe not by a long shot. It is just smoke and mirrors that ole Joe is trying to sell us. Chicken little crying all is well, no worries he’s got our backs. Yes with a dagger in it.

Kim
Kim
3 months ago

And how many of those Dow 30 or Nasdaq companies had massive job cuts in the past year or two? Some technology, banking, retail, and manufacturing companies have each cut jobs by the thousands. A growing, robust economy doesn’t see the unemployment rate increase from 3.5% up to 3.9% in a few months.

Also, for my small horticultural business, I buy more supplies than I need for the current season because I know the prices will continue to increase at greater than inflation numbers. We’ve suffered huge wholesale price increases since Covid, and, with strong retail demand for these products, I don’t see wholesale prices coming down any time soon. Or ever. I recently compared prices between the 2023 and 2024 catalogs. Seeds and supplies generally cost 5-50% more, with certain tomato seeds up 60% in one year! And delivery charges are higher, too. Sorry, folks; I’m raising some of my prices this year. See, Joe? That’s how it works.

Frankly, I don’t fully understand how the stock market is this high. But considering recent layoffs and inventory plumping, that might partially explain it. When businesses realize they can’t maintain the high labor costs, we will see large job losses. How can Walmart pay beginner cashiers $16 or $18 per hour and stay solvent? I think we’re in for a cataclysmic reckoning when the perfect storm comes to a boil.

Enuf Said
Enuf Said
3 months ago

Well, Biden might also say “the oyster” bunny brought him this news”.

Colleen
Colleen
3 months ago

Excellent article. Thank you.

Old Silk
Old Silk
3 months ago

The elites must be kept satisfied and quiet.

marty
marty
3 months ago

Dementia Joe and his Bidum(b)nomics both suck ! I worked 55 years, retiring at 70 1/2 years of age right after Joey stole the Presidency. SS sent me a letter that I got a5% raise but i hear on the radio “inflation at 9.7%”, starting out 4.7% in the hole !! A Triple whammy, I had to take a first payment from my 401k, with the market down. I saw a cartoon of O’Biden looking grand-fatherly saying “Milton Friedman doesn’t run the show anymore” !NO KIDDING,there !!

Bacon Nivison
Bacon Nivison
3 months ago

Sadly, it’s the goal of the globalist mob. To tear America down to some sort of equality with the rest of the world. It’s not a disappointment to them to see the stock market fade, it’s their goal. Trump going through the police-state nonsense has nothing to do with conservatism or Republicratism. It is because he’s an anti-globalist. Make America Great Again IS a curse in their world AND he is our last hope. If we don’t get the demonic rats out of control, we’re finished and Peddo-Joe’s bosses, Xi Jinping, George Soros and the lot, will be smiling as they scoop up your money.

johnh
johnh
3 months ago

When Trump or Biden brag about the great economics when they are sitting POTUS, what are they looking at. Do they take credit for the Stock market highs & the CEO of companies making million dollar salaries or what? Do either one of them have any concerns about our increasing Federal Debt?

Tim Toroian
Tim Toroian
3 months ago

These Democrats got their lying lessons from the out-of-work ex-Soviet propagandists they hired in the 90s.

johnh
johnh
3 months ago

Stock market returns are way up, but if you look up THE MAGNIFICENT SEVEN stocks that have soared the last two years & it is a big concern what is driving the market. Most of these stocks do not produce a product that contributes to our GDP. The Truth Social entrance last week & value this week are a good example of this type of investment.

David Millikan
David Millikan
3 months ago

Excellent article. Dictator Beijing biden even Cancelled the Order to REFILL the National Strategic Oil Reserves that he emptied and SOLD our EMERGENCY OIL to Communist China which is intentional espionage and treason including playing politics to lower gasoline prices over 2 years ago.
As usual, Dictator Beijing biden puts the United States and Legal American Citizens LAST.
This would NEVER have happened with President Trump.
We had plenty of Oil and Low gasoline prices with President Trump and we were the Number One Producer and Exporter in the World.
Dictator Beijing biden is making sure gasoline prices skyrocket this summer and coming winter.
Another excellent reason why I am Voting for President Trump.
President Trump puts the United States FIRST.

Mike
Mike
3 months ago

He (they) thrive on emotions. The stock market no longer is based on financial fundamentals, so it’s a house of cards that will fail. He (they) don’t care as long as it appears good prior to ejections.

Barrett T Smith
Barrett T Smith
3 months ago

Biden will not take the blame for inflation but is quick to claim credit for the stock market.

Kyle Buy you some guns,and learn how to shoot
Kyle Buy you some guns,and learn how to shoot
3 months ago

AMAC It’s good to see you back again. Kyle L.

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