The U.S. stock market has gained 34% under President Biden so far, outperforming the 6% gain at the same point under President Trump.
However, Trump’s record may look better later as the large rally in 2020 gets included.
Presidents often take credit for the market but have limited direct impact, as reactions to events like the COVID pandemic are driven more by uncertainty than partisan policies.
Both Biden and Trump have been claiming credit and blame as the 2024 election nears.
“There’s always a lag effect between policy and its economic impact and what that means for markets, and so what credit or blame a president should or should not get is not straightforward,” said Brian Gardner, chief Washington policy strategist at Stifel. “They probably get too much credit.”
While Biden now has a better stock performance, Trump had led in December 2020 prior to leaving office when the market had risen 48% from his inauguration.
Betting markets currently give Trump a slight edge to win in 2024, though investors appear more confident in his prospects and the potential for continued tax cuts.
“I don’t think anyone would say because there was a Democrat or Republican in the White House, how the market reacts to a global pandemic would be, at least in the early stages, materially different,” Washington policy analyst Ed Mills said.
“That has helped the market. It’s not the primary reason for the market rally, but it is a contributing factor,” Gardner said.
“But at the same time, I would also argue that investors are questioning — but kind of overlooking for now — the impact of possible additional tariffs. They’re looking at the parts of the Trump agenda that they like and discounting parts they don’t like,” he said.
Campaign representatives for both presidents argued the other’s policies hurt the economy and average Americans.
“Under President Trump, inflation was nonexistent, gasoline RB00, -1.24% was cheap, groceries were affordable and the American Dream was alive and well,” Trump campaign spokeswoman Karoline Leavitt stated. “America cannot afford four more years of Joe Biden — we need a businessman and a proven leader like President Trump who will get our economy booming again.”
Trump’s tax cuts were for “his ultra-rich friends while factories shuttered, jobs were shipped overseas, and the national debt skyrocketed,” Biden campaign spokesman Seth Schuster said.
“Trump knows the economy is doing well — that’s why he’s trying to take credit for it,” Schuster added. “President Biden is happy to tout his record of historic job creation and low unemployment, while he continues to fight to lower costs for families.”
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