The last three such turnovers came in 2000, with the election of George W. Bush; 1980, Ronald Reagan; and 1968, Richard Nixon. Kaeppel looks at the percentage gain and loss for the Dow Jones Industrial Average DJIA, +0.32% from Dec. 31 of the election year through the subsequent midterm election year for each, in other words, roughly the first 20 months of each new administration.Bush got hammered by 9/11 less than a year into his term. That torpedoed any chance of meaningful tax reform or anything else other than the drumbeat of war and trillions that it took to fight it. You also had a recession during this time as well. During this time you have the FED raising rates like crazy to cool off the stock market's "irrational exuberance." Nothing like we have now
During the 1980s with Ronald Reagan you had interest rates at 12%. Imagine if you could buy a bond that would pay better then nearly any stock out there today. However, if you bought the S&P500 on Jan 20, 1980 you were in at 111.07 and Jan 20, 1984 you were at 167.04. A very nice gain that looks nothing like this chart in the link above. If you held for Reagans entire term you would have made a pretty nice sum.
Nixon had high inflation to deal with along with the Vietnam war, riots, etc. in the early part of his term. Then you had the Yom Kippur War and a subsequent Oil Embargo dropping us into a recession. Finally, he had to resign because of Watergate. It's hard to think of economic policy when you are negotiating with the Vietnamese, while fighting a war, and then having the Congress voting on articles of impeachment. You add 10% inflation to this mix and its hard to think about any meaningful growth during this time.
In any case unless we fight a new war (with who I have no idea,) have insane inflation, or sky-high interest rates we won't see that BS cascading waterfall chart in that link above. The other thing that is messed up is this Jay Kaeppel guy also conveniently forgets the raging bull market in 1952-1954 when Eisenhower had a GOP Congress. I do agree that one should be careful at all time highs and missteps by the GOP Congress could give us a pullback but nothing like that 25% drop in the S&P 500 that this guy is predicting.