During the early years of his relationship with Susie Thompson, Warren Buffett faced skepticism from her father, Doc Thompson, regarding the future of the stock market. Doc Thompson, expressing a sharp political perspective, lamented that President Harry Truman had failed in his efforts to contain communism, predicting that stocks would ultimately become "valueless bits of paper." Despite this grim outlook, the marriage between Warren and Susie proceeded.
Countering that pessimistic forecast, the S&P 500 began 1953, the year of Warren and Susie's wedding, at a level of 26.18. Over the following decade, the index climbed by 148%. Fast forwarding to January 16, 2026, the S&P 500 stood at 6,940.01, representing a remarkable 26,409% increase since the time of Doc Thompson's dismissive assessment.
This extraordinary return translates to turning every initial one dollar invested into more than $265 over the period. Adjusting for inflation since 1952, the actual purchasing power of $1 has risen to approximately $12.23, marking an inflation-adjusted gain of 1,123%. This underscores the powerful growth potential of sustained investing in the stock market.
It's important to acknowledge that Doc Thompson's concerns were not unique. Many investors have hesitated to participate in the stock market due to political ideologies or fears. Some of the challenges he anticipated, including the spread of communism, inflation, and the 1957 market downturn, did materialize. Yet these events did not permanently diminish the market's long-term upward trajectory.
Political leadership undeniably influences certain industries and can impact economic policies, which in turn affect market performance. To assess whether political affiliations or leadership should deter investors, an analysis was conducted of the S&P 500 closing values on the inauguration dates of the last ten U.S. presidents, including each of Donald Trump's two non-consecutive terms. The comparison involves the index's closing levels at the end of each presidency and the latest available values as of January 16, 2026.
| President | S&P 500 at Inauguration | S&P 500 Gain During Term | S&P 500 Gain Since Inauguration (to 2026) |
|---|---|---|---|
| Jimmy Carter | 102.97 | 28% | 6,639% |
| Ronald Reagan | 131.65 | 118% | 5,172% |
| George H.W. Bush | 286.63 | 51% | 2,321% |
| Bill Clinton | 433.37 | 210% | 1,501% |
| George W. Bush | 1,342.45 | -40% | 417% |
| Barack Obama | 805.22 | 182% | 762% |
| Donald Trump I | 2,271.31 | 70% | 206% |
| Joe Biden | 3,851.85 | 56% | 80% |
| Donald Trump II | 5,996.66 | ? | 16% |
The data reveals that only one president, George W. Bush, oversaw a decline in the S&P 500 over their term, with a negative 40% return. Nevertheless, since his inauguration, the market has grown more than fourfold. Presidents Joe Biden and Donald Trump presided over significant market downturns during their initial years—Trump during the pandemic-driven crash in 2020, and Biden throughout 2022's sell-off. Despite these, both concluded their terms with positive market growth.
Although the current presidency still has three years remaining, and market developments remain unpredictable, historical patterns highlight a persistent upward trend in stock market returns regardless of which political party controls the White House. Therefore, basing investment decisions solely on political considerations may result in missed wealth-building opportunities.
In conclusion, the substantial long-term gains demonstrated over multiple decades illustrate why allowing political biases to influence market participation is often counterproductive. Investors may benefit more from a long-term, steady approach rather than reacting to short-term political events or leadership changes.