# Is the stock market giving Bush's policies a thumbs-up? **URL:** \ **Category:** Great Debates\ **Created:** [July 17, 2007, 11:22pm UTC](https://boards.straightdope.com/t/is-the-stock-market-giving-bushs-policies-a-thumbs-up/412194 "2007-07-17T23:22:42Z")\ **Posts on this page:** 8\ **Page:** 3
**Author:** ![David\_Simmons](https://avatars.discourse-cdn.com/v4/letter/d/9de053/32.png) [@David\_Simmons](https://boards.straightdope.com/u/David_Simmons)\ **Post date:** [July 20, 2007, 12:32pm UTC](https://boards.straightdope.com/t/is-the-stock-market-giving-bushs-policies-a-thumbs-up/412194/41 "2007-07-20T12:32:53Z")
[QUOTE=Sam Stone] A two-income family of four earning $75,000 pays about $1,848 less in total provincial taxes, including health care premiums, sales and other excise taxes, in Alberta than in Ontario and almost $2,874 less than in Quebec. … Our booming energy industry is a big part of that, but not the only part. [/QUOTE] So if you have oil and oil is $75 a barrel business is pretty good and can grow even if there are government taxes for health care. ---
**Author:** ![Spoke](https://avatars.discourse-cdn.com/v4/letter/s/a88e57/32.png) [@Spoke](https://boards.straightdope.com/u/Spoke)\ **Post date:** [July 20, 2007, 7:48pm UTC](https://boards.straightdope.com/t/is-the-stock-market-giving-bushs-policies-a-thumbs-up/412194/42 "2007-07-20T19:48:30Z")
More evidence of the disconnect between Wall Street and Main Street: [Leading indicators slip in June, suggesting nation’s economy to slow](http://www.savannahnow.com/node/328853) From the article: > [@](#): > > The nation’s economy could be in for a sluggish spell in coming months as a downturn in the housing industry takes a deeper toll on businesses and consumers. > > The Conference Board’s index of leading economic indicators, released Thursday, signaled economic weakness with a 0.3 percent decline in June, more than the 0.1 percent analysts were expecting. The article also quotes an economist whining that the index doesn’t take into account “the momentum of corporate profits driven by _overseas sales_.” But of course, overseas sales may help a corporation’s bottom line (and thus boost Wall Street) with no benefit at all to the average American. In a global economy, it seems to me that Wall Street can soar while Main Street suffers. ---
**Author:** ![David\_Simmons](https://avatars.discourse-cdn.com/v4/letter/d/9de053/32.png) [@David\_Simmons](https://boards.straightdope.com/u/David_Simmons)\ **Post date:** [July 20, 2007, 8:03pm UTC](https://boards.straightdope.com/t/is-the-stock-market-giving-bushs-policies-a-thumbs-up/412194/43 "2007-07-20T20:03:43Z")
[QUOTE=spoke-] In a global economy, it seems to me that Wall Street can soar while Main Street suffers. [/QUOTE] Simple. The average guy or gal just needs to use that extra cash that is just laying around to buy corporate stock. ---
**Author:** ![elucidator](https://avatars.discourse-cdn.com/v4/letter/e/8edcca/32.png) [@elucidator](https://boards.straightdope.com/u/elucidator)\ **Post date:** [July 20, 2007, 8:12pm UTC](https://boards.straightdope.com/t/is-the-stock-market-giving-bushs-policies-a-thumbs-up/412194/44 "2007-07-20T20:12:37Z")
There is considerable extra cash lying about. It just isn’t mine. ---
**Author:** ![Public\_Animal\_No.9](https://avatars.discourse-cdn.com/v4/letter/p/b9e5f3/32.png) [@Public\_Animal\_No.9](https://boards.straightdope.com/u/Public_Animal_No.9)\ **Post date:** [July 20, 2007, 9:25pm UTC](https://boards.straightdope.com/t/is-the-stock-market-giving-bushs-policies-a-thumbs-up/412194/45 "2007-07-20T21:25:40Z")
[QUOTE=spoke-] Yes, but- What percentage of Americans own stock, either directly or through a fund? Of those that do own _some_ stock, for what percentage of those people is stock ownership a _significant_ percentage of their total assets? I know a lot of people who might have a claim to some interest in the stock market, but for most of them, it doesn’t amount to much. For most, their home is their big asset, and home values are taking a _beating_ in a lot of markets. Meaning that even if some schlub’s 401(k) is doing better this year, he’s still losing ground overall via the faltering housing market and high interest rates on home equity loans. That’s just my sense of things. I just don’t get the sense that the stock market run-up is is any particular cause for rejoicing out among the masses. Most folks are too worried about making that mortgage payment on the loan that is ticking upward, against a house that is now worth less than the loan. Meanwhile, they’re wondering if their job is about to be shipped abroad, or taken by an undocumented immigrant who can work for less. And gas prices just aren’t going down. If the booming stock market is such a big boost to the man on the street, then [why is consumer confidence dropping](http://www.newsmax.com/money/archives/articles/2007/7/17/103710.cfm?s=mo)? [/QUOTE] 1970-15%; 1980-13%; 1989-32%; 1998-52% There’s a nice little discussion of the percent of Americans who own stock at [this website](http://www.pbs.org/fmc/book/14business6.htm). I agree that the day-to-day market isn’t on everyone’s mind, and that the market often moves contrary to what Main Street sees as important. You’ll often see unemployment go up and then the stock market goes up. And there is a big difference between having stocks you can sell now and having them in your retirement plan that you won’t see for 20 years. So on a day-to-day basis, the average guy probably isn’t terribly closely connected to Wall Street. On a longer-term basis, though, the two are very closly connected. When consumer confidence drops, people buy less, companies make less, stocks go down. Even though the stock market is still doing well, there have been lots of ups and downs lately, which is a reflection of a growing unease in the stock market, to no small degree because of consumer confidence, and to a more significant degree because of the housing and mortgage issues. Housing stocks are way down - “the market” is much more than the Dow Industrials. But there are also lots of stocks doing quite well. When energy prices go up, energy companies tend to do very well. But they’ll only do well as long as energy prices don’t put a huge clamp on people’s purchases. Once that happens, they drop as well. ---
**Author:** ![Spoke](https://avatars.discourse-cdn.com/v4/letter/s/a88e57/32.png) [@Spoke](https://boards.straightdope.com/u/Spoke)\ **Post date:** [July 21, 2007, 12:53am UTC](https://boards.straightdope.com/t/is-the-stock-market-giving-bushs-policies-a-thumbs-up/412194/46 "2007-07-21T00:53:02Z")
[QUOTE=Public Animal No. 9] 1970-15%; 1980-13%; 1989-32%; 1998-52% [/QUOTE] So as of 1998 (before the crash of 2000, which may be significant) slightly more than half owned stock, either directly or through a fund. But then very nearly half owned no stock at all, even in those boom times. And the second part of my question remains unanswered. Of those who do own stock, for what percentage of them does that represent a significant portion of their assets? My sense is that a lot of people in that 52% own only a very small amount of stock, and that for most people, their house (if they own one) is far and away their most significant asset. ---
**Author:** ![Bill\_Door](https://avatars.discourse-cdn.com/v4/letter/b/50afbb/32.png) [@Bill\_Door](https://boards.straightdope.com/u/Bill_Door)\ **Post date:** [July 21, 2007, 1:38pm UTC](https://boards.straightdope.com/t/is-the-stock-market-giving-bushs-policies-a-thumbs-up/412194/47 "2007-07-21T13:38:24Z")
Giving George Bush, or any president, credit for high stock markets is a lot like calling Ronald McDonald to tell him what a great burger you just got. The global economy is not affected that much by presidential policies. A lot of the recent run up has been caused by people moving investment dollars away from real estate. The net market of combined real estate and stocks is pretty flat, it just depends on where your investments are as to how well you’re doing. ---
**Author:** ![Spoke](https://avatars.discourse-cdn.com/v4/letter/s/a88e57/32.png) [@Spoke](https://boards.straightdope.com/u/Spoke)\ **Post date:** [July 24, 2007, 1:52am UTC](https://boards.straightdope.com/t/is-the-stock-market-giving-bushs-policies-a-thumbs-up/412194/48 "2007-07-24T01:52:31Z")
Another perspective: [this article](http://www.slate.com/id/2170745/nav/tap3/') says the soaring stock market is a product of the weak dollar, and not a reflection of a strong American economy: > [@](#): > > If you—or your mutual fund—own shares in large American corporations, you’re a winner in the weak-dollar sweepstakes. Based on data culled from 238 constituents of the Standard & Poor’s 500 Index, S&P analyst Howard Silverblatt concludes that the typical member of the index garnered 44.2 percent of its sales outside the United States in 2006. **Translating cash received from those sales into weaker dollars puts some fizz into earnings.** Last week Coca-Cola’s stock bubbled to a five-year high after it reported a fantastic quarter. Foreign sales accounted for 65 percent of Coke’s beverage business. Other ur-American companies profiting from this trend include McDonald’s (65 percent of sales overseas) and IBM (56 percent). [Previous page](https://boards.straightdope.com/t/is-the-stock-market-giving-bushs-policies-a-thumbs-up/412194.md?page=2)