Winkler: The Markets Like Presidential Elections

The video explores the correlation between U.S. presidential elections and stock market trends, highlighting that elections generally lead to favorable market conditions, with exceptions in 2000 and 2008. It discusses how both Republican and Democrat victories influence market confidence and performance differently. Alternative hypotheses suggest that market trends may be influenced by government inactivity during election years. The video also contrasts the economic policies of the two parties, noting that Democrats tend to favor government spending for positive change, while Republicans often oppose such spending. Overall, elections are seen as beneficial for the market.

Which two years were exceptions to the positive correlation between U.S. presidential elections and the stock market?

• 1992 and 2004

• 1984 and 1996

• 2000 and 2008

• 2012 and 2016

What is one hypothesis for why the stock market performs well during election years?

• Increased government spending

• Government inactivity

• Higher voter turnout

• International trade agreements

How did the stock market react to the transition from Reagan to Bush?

• It was unaffected

• It responded positively

• It remained stable

• It declined significantly

What economic approach do Democrats typically favor?

• Reducing government spending

• Increasing taxes

• Using government as an instrument of positive change

• Privatizing public services

Which market tends to perform better when Republicans are in power?

• Stock market

• Commodities market

• Bond market

• Real estate market