I happened to find some interesing tables in my computer files. The first table shows the presidential cycle versus stock market performance. The preelection year(3rd year) and election year(4th year) is normally strong, while the postelection year(1st year) and mideyear(2nd year) are normally weak. However, there is a big exception – Hoover era – due to the Great Depression. I hope Obama does not revisit the situation of Hoover’s era.

The second table demonstrates the stock behavior on the election year from 1924 to 2004. In general, the stock market would have some good rally for Nov. and Dec. as the election is finished. But it appears that’s not the case for this year.

PBS aired “Stock Market Crach” yesterday. The circumstances were so similar to the current situation and I lost my nerves to watch it. Anyway, it said that Hoover did not take any actions and his policy led the market to the depression. Fed do some kind of actions right now, but I don’t think it is fair. Some of the article talked about his favouritism on GS.

There are still substantial disagreements among scholars about the cause of the Great Depression and the source of the recovery. I’m not defending Hoover, but I guess he could not react effectively to the Depression because it happened so fast and suddenly that he cannot do ‘something’. In fact, Federal Reserve gave a great effort to mitigate the impact. Some people say the source the recovery is war, but many people say that the source is the huge increase of money supply, which is done by Fed’s monetary policy change on 1932.

Anyway, we are living in the capitalism after all, and I would say the capital governs State rather than State controls the capital. Actually, Federal Reserve is not a government institution, that is a private body that is controlled by who has money. So, I wouldn’t be surprised if Fed is biased to one direction.

I should have watched the PBS yesterday. I’ll check out their web site to see if they archived it in video. Thanks for the info.

This is the link to PBS

http://www.pbs.org/wgbh/amex/crash/program/index.html

This documentary was aired during 1980s.

that was an interesting historical data. i liked your analysis based on numerical data and attempting to combine it with your own theory. i believe thats where objective criticism could come into a play.

i agree that the fed has been the regulator of money supply since its born, but i disagree that its a private identity. i would say its a hybrid identiy as long as it is a cartel. the monetary policy change was legislated by u.s. congress back then when it was founded. that means u.s government is not be free from duty, but the major right is ironically taken by private bankers. more precisely, it was an outcome from european banking interests. they wanted put america into their orbit, and i still believe great depression came from lack of money supply. a little panic was previously created by jp morgan even before great depression. the panic easily created fear so then americans finally handed their money depository to moguls from europe by signing upon the agreement. the fed system nowadays has been able to track down money depository all over the country, and has known how much transaction is made by whom and when in real time so that having control has given them more and more creativities. they can do whatever they want, no kidding.

To spice more on your analysis, and also in case you missed one element of iron triangle, eisenhower in his speech addressed that the u.s. is military-industrial complex. by looking at the table you posted, we can surely say the bull market is somewhat relevant to warfare of u.s. goverment. we dont even need to go back too far to understand it. prior to this financial crisis, there had been attacking in iraq twice – im not sure if camels on iraq desert are still trying to damage bradley armor with their fatty tissue. we have seen last bull market almost half a decade because of the unrealized/realized economic boom affected by iraq war. look lincoln, there was civil war. roosevelt with wwii, eisenhower with korean war, and nixon with vietnam war. whos the next? maybe we have another war to come.

however, it is still moot if the past can possibly provide us foreknowledge on any future incidence – if it did, there would be plenty of economists sitting on money with no doubt. moreover, one of my respectful investors said that we cannot see the future thru the rearview mirror. pattern matching is always an interesting thing to do in case with thresholds in leniency, but the tolerance wont be tolerated when it doesnt go along well with the easy guesstimation. some traces to grab a symptom would be the best means unless we have a total control, and we will have no fear as long as we know what we are doing.

I appreciate your opinion, Jason. You have pretty good knowledge on it.

The fed has a hybrid identity as a cartel. I guess this statement is correct as far as what it looks like. I have no detailed knowledge about how the fed is running. But, it shows that the fed is more likely a private body according to a lot of quotes with regards to the fed reserve from the people who were involved in the institution.

Here are some of them(not all of them).

* “From now on, depressions will be scientifically created.”
— Congressman Charles A.Lindbergh Sr. , 1913
* “The financial system has been turned over to the Federal Reserve Board. That Board administers the finance system by authority of a purely profiteering group. The system is Private, conducted for the sole purpose of obtaining the greatest possible profits from the use of other people’s money”
— Congressman Charles A. Lindbergh Sr., 1923

* “We have, in this country, one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board. This evil institution has impoverished the people of the United States and has practically bankrupted our government. It has done this through the corrupt practices of the moneyed vultures who control it”.
* “The Federal Reserve banks are one of the most corrupt institutions the world has ever seen. There is not a man within the sound of my voice who does not know that this nation is run by the International bankers
— Congressman Louis T. McFadden, Chairman of the Committee on Banking and Currency (12 years) in 1932 (Rep. Pa)

* “Some people think the Federal Reserve Banks are the United States government’s institutions.They are not government institutions. They are private credit monopolies which prey upon the people of the United States for the benefit of themselves and their foreign swindlers”
— Congressional Record 12595-12603. Louis T. McFadden, Chairman of the Committee on Banking and Currency (12 years) June 10, 1932

* “Most Americans have no real understanding of the operation of the international money lenders. The accounts of the Federal Reserve System have never been audited. It operates outside the control of Congress and manipulates the credit of the United States”
— Sen. Barry Goldwater (Rep. AZ)

* “The regional Federal Reserve banks are not government agencies. …but are independent,privately owned and locally controlled corporations.”
— Lewis vs. United States, 680 F. 2d 1239 9th Circuit 1982

* “It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
— Henry Ford

* “…the increase in the assets of the Federal Reserve banks from 143 million dollars in 1913 to 45 billion dollars in 1949 went directly to the private stockholders of the [federal reserve] banks.”
— Eustace Mullins