How the Dow in a President's second year can predict his reelection

[Mr.Phips]

I have found a new predictor of Presidential elections, the Dow Jones Industrial Average in the second year of a President's term. 

Check this out:

President               Dow in Year 2        Won/Lost Reelection?

Bush(2002)          -21%                     Won
Clinton(1994)     +.03%                     Won
Bush(1990)          -8.1%                     Lost
Reagan(1982)      +21%                    Won
Carter(1978)           -3%                      Lost
Nixon(1970)          +3.7%                  Won
Eisenhower(1954) +43%                  Won
FDR(1942)              +6.2%                 Won
FDR(1938)              +28%                  Won
FDR(1934)              +4%                    Won
Hoover(1930)         -50%                   Lost


The correlation here is almost immaculate, missing just once out of 11 times.  The reasoning behind this correlation is that the Dow can be seen as a leading indicator of what the economy will look like in 16-24 months.

[phk]

It might be fruitful to see if the 20 SMA is higher than  the 200 SMA.

[Sasquatch]

If hadn't been for those pesky wars and terra' this would have been 11 for 11.

[Mr.Phips]

Thats interesting...what is the dow now?

Down about 2.8%. 

[tpfkaw]

What about Truman?

[Mr.Phips]

What about Truman?

I didnt use Truman in 1946 because he was technically just finishing up FDR's final term and running in his own right in 1948.  The Dow was down 8.5% in 1946.