The stock market has a 'funny way of testing new Fed chairs'
Pablo Martinez Monsivais/AP
- Markets tend to test new Federal Reserve chairs not long after they take over; Jerome Powell's first drubbing came especially quickly with last week's sharp reversal.
- The Dow Jones industrial average gained 63% under Janet Yellen's four-year tenure, the sixth best run of 15 Fed chairs, according to LPL Research.
- The best total return under a Fed chair is the 312% Dow gain under Alan Greenspan; but he was also the longest tenured Fed chair at 18.5 years, so his annualized return is only 8.0%.
History suggests it’s hardly a coincidence to have stocks take a spill not long after a new Federal Reserve chair is installed — Jerome Powell just received the drubbing a little sooner than most, on his very first day on the job.
"As Janet Yellen hands over the reins to Jerome Powell at the Federal Reserve (Fed), a look back at history shows that markets have a funny way of testing new Fed chairs," LPL analysts wrote in a blogpost. See the rest of the story at Business Insider
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