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Which Dem might the Street like best?

Posted By Barry Ritholtz On January 19, 2004 @ 11:00 am In Finance,Politics | Comments Disabled

There’s an interesting article with a fascinating premise over at CNN/Money [1]: Which of the top Democratic candidates does the stock market prefer?

The writer, Alexandra Twin, looks at the pros and cons of each Democratic candidate from a market based perspective. How might each Dems’ economic policies be perceived by “The Street?” Its an engaging approach (done well by Twin) that I have not seen written up elsewhere in the mainstream media. I only discovered it because she had spoken to me about the subject of tax policy and Wall Street.

Contributions by Candidate
cand_contributions.gif [1]

You may be surprised to learn, as I was, that Wall Street has not donated that much more money to President Bush than to the Democrats: As of November 2003, Bush received $3.9 million dollars; The top 6 Democratic candidates got a total of $2.8 million dollars. While that’s still a hefty gap, I’ll surmise its smaller than many people would have guessed. (You may also be surprised to learn that the stock market does better under Democrats than Republicans *).

Goldman Sachs may be a big part of the reason for the gap being as (relatively) narrow as it is: They are well known contributors to the Democrats, and two of their former senior executives became stars in the Democratic Party: former Chairman Jon Corzine, a Democrat, is the senior Senator from New Jersey; Robert Rubin, another Goldman alumnus, was Prsident Clinton’s Treasury Secretary.

Goldman ponied up more than double what either of the next closest Wall Street contributors did: more than $1.6 million dollars. Morgan Stanley and Merrill Lynch each gave about 3/4 of a million dollars.

Contributions by Security Firm
sec_firms_contributors.gif [1]

* The article cites a recent study from the University of California at Berkeley (published in the October issue of the Journal of Finance). “Between 1927 and 1998, the stock market returned approximately 11 percent more a year under a Democratic president versus safer, three-month Treasurys. By comparison, the stock market only returned 2 percent more a year versus the T-bills under Republicans.”

UPDATE: 1/20/04 5:36pm New Article at CNN/Money: “Kerry and Edwards on the economy [2]
The Senators have the Big Mo coming out of Iowa; how would they handle the U.S. economy?

The article is worth checking out.

Source:
A Dem the Street might like [1]
Alexandra Twin
CNN/Money, January 16, 2004: 7:00 PM EST

http://money.cnn.com/2004/01/16/markets/election_demsmarkets/index.htm

NOTE: I link to at least 20 articles a week. Yes, I’m linking to stuff I’m quoted in. If you object to this, please let me know and I will promptly refund double your subscription fees to The Big Picture [3].


Article printed from The Big Picture: http://www.ritholtz.com/blog

URL to article: http://www.ritholtz.com/blog/2004/01/which-dem-might-the-street-like-best/

URLs in this post:

[1] CNN/Money: http://money.cnn.com/2004/01/16/markets/election_demsmarkets/index.htm

[2] Kerry and Edwards on the economy: http://money.cnn.com/2004/01/20/news/economy/election_bigmo/index.htm

[3] The Big Picture: http://bigpicture.typepad.com/comments/

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